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Tony Elumelu: UBA didn’t fund OML 17 acquisition

Tony Elumelu: UBA didn’t fund OML 17 acquisition
May 05
12:58 2021

Tony Elumelu, chairman of Heirs Holdings, says the United Bank for Africa (UBA) did not fund the acquisition of oil mining licence (OML) 17 .

In January, Heirs Holdings, in partnership with Transnational Corporation of Nigeria Plc, announced the unconditional acquisition of a 45 per cent participating interest in OML 17 through TNOG Oil and Gas Limited, their associated company.

The acquisition included all assets of the previous owners — Shell Petroleum Development Company of Nigeria Ltd (SPDC) (30 per cent), Total E&P Nigeria Ltd (10 per cent) and ENI (five per cent) — in the lease.

Elumelu serves as chairman of UBA, Transcorp and Heirs Holdings.


In an interview on Arise TV on Wednesday, Elumelu said UBA did not participate in the acquisition of OML 17.

He said the fund was obtained from other international and local lenders including African Export-Import Bank (Afreximbank), Absa in South Africa, Fidelity Bank and Union Bank.

“On the oil and gas acquisition we just made, UBA did not even participate in the funding. It is a club of international and local lenders,” he said.


“The local receiving bank for our proceeds is Union Bank of Nigeria, the international receiving bank for the proceed of our oil sales is Standard Chartered Bank London.

“The transaction, if people read, was funded by consortium of banks including Afrexim, Absa in South Africa, Union Bank, Fidelity Bank and a host of other internationals.

“We are mindful of all these issues and we are very prudent in making sure we do not put pressure on the banks. We go out to seek funds to support our operations, we also put in equity in our investment but when we need to get funding we try not to put pressure on the institution.”

Elumelu said OML 17 currently produces 31,000 barrels of oil daily. He said the company targets a daily production of 100,000 barrels.


The group chairman said the acquisition of the oil field portrays the organisation’s commitment in the energy sector.

“The acquisition of investment in oil and gas is one that speaks to our overall energy strategy. Our energy strategy is integrated. It is to make sure we help Nigerian citizens and Africans to have access to electricity,” he said.

“We acquired OML 17 and we made a case to NNPC by justifying that we have the capacity and capability to operate the asset and they approved for us to operate.

“I am happy to say that it is a truly indigenous oil and gas company owned and operated by Nigerians. Today, we produce about 31,000 barrels of oil per day which is a slight improvement. Our ambition is to do over 100,000 barrels of oil per day.”


Elumelu also called for the development of Nigeria’s power sector, saying 100,000 megawatts of power is needed daily to drive the economy.

He identified efforts made by The Tony Elumelu Foundation (TEF), a non-governmental organisation headed by him, in supporting African entrepreneurs.


The philanthropist noted that about 10,000 African entrepreneurs have benefit from TEF, but added that some beneficiaries in Nigeria may not succeed due to poor power supply.


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