NIGERIA: Africa Oil Announces the Receipt of Prime Dividend

Prime has distributed a US$100 million dividend with a net payment to Africa Oil of US$50 million related to its 50% shareholding. Since acquiring its 50% shareholding in Prime for a cash consideration of $520 million in January 2020, Africa Oil has received ten dividends from Prime for a total amount of $400 million, representing 77% of the cash consideration paid.

The Company intends to apply US$23 million from the latest dividend, to repay the outstanding balance of its corporate loan and will subsequently become debt-free. The Company will continue to have access to an undrawn availability of $62 million under its corporate loan facility. This undrawn amount is available until May 2022 and can be utilised for general corporate purposes, subject to customary covenants. The Company also had a cash balance of $38.9 million as of September 30, 2021.

Keith Hill, Africa Oil’s President and CEO, commented: “It is less than two years since we closed the acquisition of our 50% shareholding in Prime for $520 million. We have so far received $400 million in dividends, and I am pleased that we have repaid the $250 million loan that was arranged for this acquisition. Considering the strength of our debt-free balance sheet, access to material credit liquidity, our share of Prime’s cash resources and future cash flows, I am confident that we can deliver on our strategic objectives of shareholder capital returns and the acquisition of producing assets. And of course, most immediately, we look forward to the drilling results from our high impact Venus-1 exploration well, offshore Namibia.”