Access Bank Plc has granted a $150million Senior Secured Term Loan to FHN 26, a wholly indigenous affiliate of the Afren Group whose core business is focused on exploration and production of hydrocarbon resources.
The landmark deal signed at the Access Bank’s head office, Lagos, is a testament to the Bank’s contribution to the development of the Nigerian Oil and Gas sector as well as its commitment to empowerment of stakeholders in critical sectors of the economy.
Leading the FHN team, Ahonsi Unuigbe, its Executive Director and Chief Financial Officer, expressed delight at the success of the deal, noting that it came on the heels of increasing appetite of indigenous companies for asset portfolios expansion through anticipated DPR Marginal Fields bid rounds and the ongoing Shell onshore asset divestments.
He also remarked on the speed and flexibility shown by Access Bank in arranging the financing and hoped that more Nigerian banks would emulate Access Bank in order to further accelerate development in the country’s fast growing indigenous upstream oil sector.
Femi Bajomo, also an Executive Director and Chief Operating Officer of the company on his part observed that with this financing, the company had additional capacity to fund it’s capital expenditure obligations in the coming years, particularly with respect to the drilling of new wells, which would result in a significant increase in it’s production capacity over the next eighteen months.
Similarly, Herbert Wigwe, Access Bank’s Group Deputy Managing Director who described the deal as another laudable contribution by the Bank to funding for acquisition of Oil and Gas assets in line with the local content aspirations of the Federal Government, commended the management of FHN 26 Ltd for their performance over the past three years and re-affirmed the Bank’s resolve to providing the required funding for economic transformation initiatives.
Speaking on the capacity of Nigerian banks to fund big ticket transactions, Wigwe said that Nigerian Banks are better positioned to facilitate and execute large deals required for mineral rights acquisition which hitherto were the exclusive right of foreign Banks.
He also enjoined players in the Oil and Gas sector to tow the path of sustainable growth through enhanced technical capacity to ensure the industry remains credible enough to continue to attract significant level of funding required to support growth.
It would be recalled that FHN 26 Ltd emerged the winner for OML 26 during the last Shell divestment exercise. This development affirms the fact that indigenous companies in the energy sector now have the requisite financial resources, technical support and managerial capacity to effectively exploit and develop the assets being offered for sale by multinational oil companies.