Lekoil Oil and Gas Investments Limited has signed a $11.5 million facility with FBNQuest Merchant Bank. This was announced by the company in a statement sent to the London Stock Exchange.
Lekoil Oil and Gas Investments Limited’s parent company, LEKOIL Nigeria Limited, said it had agreed to guarantee the obligations of the latter in its pursuit of the facility.
[READ MORE: Lekoil to boost production output by listing on NSE]
Purpose of the credit facility: According to the company’s Chief Executive Officer, Lekan Akinyanmi, the facility would provide Lekoil with increased flexibility at a cost of capital in line with its existing facilities.
“I am delighted that we have agreed to this additional facility with FBNQuest, a key local lender in Nigeria. This facility provides us with increased flexibility at a cost of capital in-line with our existing facilities. We appreciate FBNQuest’s support and appreciate our growing long-term relationship with them.”
More details on the facility: As stated in the statement, the facility has a maturity of four years and is repayable quarterly with a margin of LIBOR + 10%. The company also said it expected to draw down on the facility as needed, which had no pre-payment penalty.
“The facility will be used primarily to pay all outstanding quarterly repayments (including principal and interest) due to Shell Western Supply and Trading Limited and payment of the licence/lease extension fees on OPL 276 (as announced on August 23 2019) and OPL 310 ($7.5m due by October 31, 2019).”
About Lekoil: Lekoil is an Africa-focused oil exploration and production company with interests currently in Nigeria and offshore Namibia.
The company was founded in 2010 by a group of leading professionals with extensive experience in the international upstream oil and gas industry as well as in global fund management and investment banking.