ADM lines up Barracuda buy

ADM lines up Barracuda buy

ADM Energy has set out a plan to acquire a stake in the Barracuda field, in Nigeria's OML 141.

The company will acquire a 51% stake in KONH UK, which has a 70% indirect interest in the risk-sharing agreement (RSA) on Barracuda via Noble Hill – Network. It expects the field to begin producing in the second half of the year.

ADM may pay up to $1.3 million for the investment. Of this amount, $250,000 will be provided in cash on completion. It will pay the remainder in equity, on completion and at certain project milestones.

ADM also set out plans to raise $500,000 through new shares to provide funding for its plans. It will carry this out via an accelerated bookbuild.

“This is a compelling investment opportunity that provides ADM with the potential to access near-term production upside at minimal risk,” said ADM's CEO Osamede Okhomina.

“The Barracuda Field in OML 141 fits our strategy to target near-term production assets in proven oil and gas jurisdictions and will establish ADM Energy as a multi-asset player in Nigeria.”

Okhomina went on to say ADM would provide technical and financial support for the development of the asset.

“We have structured the deal to receive an accelerated cash entitlement