White Nile CEO: To give substantial stake to South Sudan govt
By Benoit Faucon and Jackie Range
LONDON, Mar 3, 2005 (Dow Jones) — U.K.-based oil-exploration company White Nile Ltd. ( WNL.LN) is to give a substantial stake in the company to South Sudan’s autonomous authorities in the wake of an agreement on exploration rights.
Chief Executive Phil Edmonds, in an interview with Dow Jones Newswires, referred to White Nile’s agreement last month with the South Sudanese government to acquire a 60% interest in the 67,500-square-kilometer ‘Block Ba’.
Edmonds said that after the deal, the South Sudanese government is to take a ” substantial” stake in White Nile, via its national oil company Nile Petroleum Ltd.
“These assets belong to Africans. Why not help them benefit from capital markets?” Edmonds said.
Edmonds also said he and other White Nile founder Andrew Groves are in talks with other African governments regarding similar kinds of deals.
A person close to White Nile Thursday separately said full details of the South Sudanese deal should be released Friday.
The block was previously held by France’s Total SA (TOT), which is disputing the legality of White Nile’s deal to acquire a 60% interest.
A person familiar with the deal said Nile Petroleum would get 50% of White Nile.
Nile Petroleum’s holding in U.K.-listed White Nile would be the first time an African national oil company had a market listing, albeit indirect, on a major international stock exchange.
Industry experts said other African national oil companies could seek out stock-exchange listings to gain financing and lift competitive pressure against international oil majors.
A London-based analyst said Sonatrach (SON.YY), Algeria’s national oil-and-gas company, and Sonangol EP, its Angolan peer, would fit the profile for a possible listing, as they need to finance their global ambitions.
He said these two companies hypothetically may decide to float only their international operations, to avoid scrutiny of their country’s most-prized national asset.
Sonangol and Sonatrach couldn’t be reached for comment.
One industry expert said: “National oil companies will increasingly compete globally with major oil companies, but they need the money for it.”
Sonangol especially would be in a position to tap international markets, according to an industry source familiar with the company. “They are highly respected. They pay their debt in time and trade their oil properly in Houston and London,” the person said.
Last August Sonangol raised $2.25 billion in a structured loan with international banks, the largest-ever oil-backed financing.
The transaction was underwritten by a number of large, foreign banks including Barclays PLC (BCS), Commerzbank AG (CBK.XE) and Deutsche Bank AG (DB).