Theophilus Danjuma loses bid to acquire Angolan oil block

South Atlantic Petroleum (SAPETRO), the oil and gas exploration and production company firm owned by Nigerian billionaire Theophilus Danjuma, has lost the bid to purchase some equity in deepwater Block 32, off Angola owned by Galp Energia.

SAPETRO lost to Somoil, the largest oil exploration company in Angola.

Galp Energia, a Portuguese independent, announced it had agreed to sell its 9% stake in Block 14, 4.5 percent of Block 14K and five percent of Block 32 (to Somoil for $830 million, net of taxes on estimated capital gains, including $655 million to be received until the conclusion of the operation and $175 million of contingent payments in 2024 and 2025, dependent on the price of Brent.

SAPETRO was keen to acquire Galps’s 5% of Block 32. The problem however was that Galp was only interested in selling off all its assets in the southwest African country at once and only Somoil was interested in all the assets.

Somoil was also the preferred buyer because it had local expertise and had participated in several asset sales conducted in its home country over the past few years.

SAPETRO has been unlucky in its quest to expand its operations outside Nigeria where it is one of the largest independent E&P companies. It invested in Afren in 2014, around the time the company was heading into bankruptcy.

It also tried to revamp the Seme field off Benin Republic and left it after investing millions of dollars. SAPETRO also purchased a 90-percent participating interest in the Belo Profond production sharing contract in the Mozambique Channel deepwater off Madagascar from U.S. junior Marex MC Inc., but exited Madagascar in 2018 without producing a single drop of oil over a myriad of disagreements with the Malagasy government.

Danjuma founded SAPETRO in 1995.

The company is an interest holder in deep-water OML 130 and OPL 246.

Somoil was founded by Angolan multi-millionaire Joaquim David, a former director general of Sonangol, Angola’s state-owned oil company.

It produces more than 16,000 barrels of oil per day and is the operator of two blocks in the Lower Congo Basin: offshore Block 2/05 (under a production-sharing agreement) and onshore blocks FS and FST (under a concession contract).

Somoil also has a tiny but growing presence in petroleum distribution in Angola.