MCB Group Expands African Footprint with Strategic Investment

The MCB Group is taking a significant step in enhancing its presence in Africa by financing 33.33% of a $360 million acquisition of oil assets in Nigeria. The assets were purchased by Chappal Energies, a Nigerian company renowned for its expertise in identifying high-potential oil installations. This acquisition involves the purchase of offshore facilities previously owned by Equinor Nigeria Energy Company, a subsidiary of the Norwegian multinational corporation Equinor.

Chappal Energies has a solid reputation in the exploitation of oil and gas reserves in the Niger Delta region of West Africa.

The acquisition involved the entirety of Equinor’s offshore oil and gas assets, being vital for meeting the energy demands of African economies and for encouraging projects centered around alternative energy sources.

One of the notable aspects of this deal is Chappal Energies’ ability to capitalize on abandoned oil facilities.

Many operators have left these installations for various reasons, leaving behind opportunities ripe for growth.

This ability to identify and acquire such assets positions Chappal Energies favorably in the burgeoning Nigerian oil market.

Based in Mauritius, Chappal Energies operates from its office located on the fifth floor of the Nexsky Building in Ebène’s Cyber City.

The selling entity, ENEC, is a well-established player in the Nigerian oil industry and was looking to offload its 53.85% stake in a lease assigned to Agbami when Chappal seized the opportunity.

The Agbami field is a key player in the sector, holding a license to explore oil and gas reserves in deepwater blocks 128 and 129, with exploration licenses lasting between five to twenty years.

Equinor itself held a 20.21% interest in the operational licenses for these fields.

The oil operations in block 128, extending from 1,000 to 2,000 meters below the surface, have been assigned to Chevron Corporation, one of the United States’ leading oil companies.

Chevron engaged in various facets of oil and gas production, including exploration, refining, sales, transport, chemical production, and even electricity generation.

The MCB Group’s investment of $120 million, representing a third of the total acquisition cost, reflects the confidence of its leadership in the potential success of this venture.

As stated by Thierry Hebraud, CEO of MCB Group, “As a bank rooted both in Mauritius and on the African continent, we are excited to facilitate and support the emergence of local champions with the technical expertise and financial capabilities to drive their industries’ future.”

Youri Harel, Executive Director of Structured Debt and Power & Infrastructure at MCB, echoed this sentiment, highlighting the value of enabling Chappal Energies to execute such a significant acquisition.

He noted that MCB takes great pride in its role in cultivating local leadership and ensuring that emerging talents receive the expertise and financial backing necessary for contributing to their nation’s development.

The importance of MCB’s role in this pivotal acquisition has been recognized by Chappal Energies’ Managing Director, Ufoma Immanuel.

He emphasized, “MCB remains a crucial partner for Chappal. The Upstream team is fully integrated into our strategic planning from the conception of ideas to the execution of transactions.

We are confident that this relationship will continue to strengthen and expand into the foreseeable future.”

The MCB Group’s team working on this operation included Avanish Gukhool, Associate Director; Jean Laurent Pyndiah and Keshav Sathyasheel Tohooloo from Specialized Finance; Ricky Kaniah and Ashna Bhudu from Credit Analysis and Structuring; and Sapna Dwarka, heading the legal department.

This strategic investment is not only reinforcing MCB Group’s commitment to supporting local enterprises in Africa but also highlighting the potential for growth within the continent’s energy sector.

Source: l’Express