Standard Bank seals R4bn funding deal for Nigeria’s Aradel Energy

Standard Bank has reached financial close on a $250 million (R3.9 billion) financing facility for Nigeria-based Aradel Energy Limited, aimed at supporting the company’s expansion and refinancing plans.

The facility, arranged by Stanbic IBTC Capital, Stanbic IBTC Bank and The Standard Bank of South Africa, will fund Aradel Energy’s acquisition of an additional 40% stake in ND Western from Petrolin Trading, refinance existing loans, and support increased production from its current assets.

Read: Standard Bank backs Safaricom Ethiopia unit with $138m funding facility

Aradel Energy, a wholly owned subsidiary of Aradel Holdings, operates the Ogbele and Omerelu onshore marginal fields and OPL 227. Before the transaction, it held a 41.67% stake in ND Western. This has now increased to 81.67%.

ND Western holds a 45% participating interest in OML 34 and a 50% stake in Renaissance Africa Energy Company, which operates the Renaissance Joint Venture. Following the deal, Aradel Energy’s indirect interest in Renaissance has risen to 53.3%.

Standard Bank acted as global coordinator and bookrunner on the transaction. Eric Fajemisin, executive director for corporate and transaction banking at Stanbic IBTC Bank, notes that the lender was supporting Aradel Energy’s growth ambitions.

Cody Aduloju, regional head of energy and infrastructure finance for West Africa at Standard Bank, says the transaction reflected the bank’s capacity to provide large-scale funding solutions.

Adegbite Falade, chief executive of Aradel Holdings, says the acquisition would strengthen the group’s position across Nigeria’s oil and gas value chain and support its strategic growth plans.

Read: Africa must use more of its own resources for growth – Standard Bank chief

Standard Bank share price