Savannah Energy Completes Acquisition of SIPEC, Targets Production Growth
Savannah Energy PLC, a British independent energy company, has announced the successful acquisition of Sinopec International Petroleum Exploration and Production Company Nigeria Limited (SIPEC),Thecable reports.
In a statement on Monday, Savannah revealed that the acquisition has increased its reserves and resource base by approximately 30%, rising from 151 million barrels of oil equivalent (mmboe) to 197 mmboe.
The deal also brings an additional 227 billion standard cubic feet (Bscf) of “2C gross gas resources” at the Stubb Creek Field, significantly boosting long-term feedstock gas supply for Accugas customers.
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Key Details of the Acquisition
Savannah explained that SIPEC’s primary asset is a 49% non-operated interest in the Stubb Creek oil and gas field, which is operated and 51% owned by Universal Energy Resources Limited, a Savannah affiliate company.
The acquisition was financed through a $60 million Reserve-Based Lending debt facility arranged by The Standard Bank of South Africa Limited. At the time of completion, the total consideration paid was approximately $35.1 million, which included $19.5 million in SIPEC’s available cash. Additionally, $2 million in deferred cash consideration will be paid over eight quarterly installments.
Following the acquisition, Savannah has launched an 18-month expansion plan to increase production at Stubb Creek Field from an average of 2.7 kbopd in 2024 to approximately 4.7 kbopd.
Stubb Creek Field Overview
Located in Akwa Ibom State, Nigeria, the Stubb Creek Field is a producing oil field with substantial undeveloped gas resources. As of year-end 2024, it held:
- 11 million stock tank barrels (MMstb) of 2P gross oil reserves
- 515 Bscf of 2C gross gas resources
Commercial oil production began at the field in 2015, with cumulative production reaching 8.1 MMstb by December 2024. The field’s crude is processed onsite before being transported via a 25 km pipeline to the Qua Iboe terminal.
Additionally, the field was converted into a 20-year Petroleum Mining Lease under the Petroleum Industry Act 2021, effective December 1, 2023.
Savannah Energy’s Growth Strategy
Andrew Knott, CEO of Savannah Energy, described the acquisition as a major milestone in the company’s 2025 strategy.
“Our focus now shifts to the expansion project at Stubb Creek Field, where we anticipate increasing production by nearly 75% over 2025 and 2026,” Knott said.
He also expressed appreciation to the Nigerian government for its support in facilitating the deal and extended a warm welcome to SIPEC employees joining Savannah.
Knott assured shareholders that regular updates on the expansion and other key business priorities would be provided in the coming months.
