Tuesday, May 10, 2011

Kulczyk Alliance Confirms Shell Nigeria Block Sale .

 Jan Kulcyzk

http://online.wsj.com/article/SB10001424052748703864204576313301460339720.html

By ALEXIS FLYNN AND BENOIT FAUCON

LONDON—A Polish and Nigerian consortium has bought a 45% stake in a Royal Dutch Shell PLC oil-and-gas block for an undisclosed amount, said Kulczyk Oil Ventures Inc., one of the partners in the alliance.

Poland's Kulczyk Oil and its Nigerian partners Nest Oil, Aries and VP Global—together comprising the Neconde consortium—will buy Shell, Eni SpA and Total SA's share of the OML 42 block, which could produce 57.3 million to 232 million barrels of oil equivalent.

The block is 30%-owned by operator Shell, with Eni and Total minority holders. Nigeria's National Petrolem Corp. owns the other 55%.

The deal, valued at $800 million by a local community leader involved in the transaction, would suggest a recent increase in Nigerian asset valuations and could set a template for improved relations with sometimes hostile communities, with local residents having an equity interest in consortium partner VP Global.

Kulczyk Oil, an exploration company controlled by Polish billionaire Jan Kulcyzk, will have a 9% interest in OML 42, it said, adding that it would enter into a technical-services agreement with Neconde.

The block's stake had previously attracted reported bids of $400 million. But valuations appear to have increased after international oil prices stabilized at a high level and Nigeria emerged as a safe haven when compared with the turbulent Arab world.

As it focuses on its largest assets, Shell has already divested other Nigerian interests, including to local firms.

Shell didn't comment when contacted Monday.

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