• Heirs Energies acquires M&P’s 20% Seplat stake for $496M, exiting french group Maurel & Prom and boosting Heirs’ total production to ~50k bpd.

• The deal leverages Seplat’s Exxon asset integration, adding ~28k boepd and vast gas reserves to Heirs’ portfolio for long-term growth.

• Backed by $750M financing, repayment relies on Seplat’s soaring cash flows and richer dividends as major new gas plants go live soon.

Heirs Energies, a subsidiary of Heirs Holdings, has solidified its position in the Nigerian energy sector by finalising the acquisition of Maurel & Prom’s entire 20.07 per cent stake in Seplat Energy. The transaction involved a payment of approximately $496 million to the French oil company. This s move allows the Nigerian investment firm to aggregate substantial production volumes, bringing its total consolidated equity oil production to roughly 50,000 barrels per day when combined with its existing assets.

The core of this transaction is the transfer of 120.4 million shares of Seplat Energy, which directly accretes production capability for Heirs Energies. By securing a one-fifth interest in Seplat, Heirs now claims a proportional share of Seplat’s output. Based on Seplat’s enhanced operational scope, this equity stake contributes approximately 27,000 to 28,000 barrels of oil equivalent per day to Heirs’ portfolio. This addition also extends to natural gas, where Seplat holds a dominant position in the domestic market. The deal grants Heirs a corresponding share of gas production, further diversifying its revenue streams beyond crude oil and reinforcing its footprint in the energy transition space.

This expansion builds upon the foundation laid by Heirs Energies in 2021, when the company entered the upstream sector through the acquisition of OML 17 from Shell, TotalEnergies, and Eni. Since that initial entry, Heirs has operated the OML 17 block, which contributes approximately 22,500 barrels per day to the company’s volumes. The integration of the new indirect volumes from Seplat with the direct production from OML 17 creates a balanced portfolio mixing onshore operations with the newly acquired interests, significantly increasing the company's total proven and probable reserves.

The value of this 20 per cent stake is heavily influenced by Seplat Energy’s recent corporate transformation, specifically its acquisition of ExxonMobil’s shallow-water assets through Mobil Producing Nigeria Unlimited (MPNU). Because Seplat successfully closed the MPNU deal before Heirs’ entry, the equity production and reserve base attributable to Heirs are considerably higher than historical averages. The addition of the ExxonMobil assets expanded Seplat’s production capacity and reserve base, meaning the 20 per cent holding now represents a slice of a much larger entity comprising both legacy onshore fields and high-yielding offshore assets.

From a financial perspective, the execution of this deal relied on a structured capital raise. The $495 million payment to Maurel & Prom was facilitated through a broader $750 million financing facility provided by the African Export-Import Bank (Afreximbank). Additionally, the Africa Finance Corporation (AFC) provided further funding support through a separate, undisclosed credit arrangement. This capital structure suggests a strategy to not only fund the immediate acquisition cost but also to refinance existing obligations and provide liquidity for operational optimisation across the Heirs portfolio.

The repayment strategy for the Afreximbank and AFC facilities hinges on the projected cash flow dynamics of the expanded asset base, driven explicitly by the conclusion of Seplat’s capital-intensive projects, such as the ANOH Gas Processing Plant. As these major infrastructure projects come online, Seplat is expected to transition from a period of high capital expenditure to a phase of free cash flow generation.

This liberation of capital, combined with the surge in net profits from the consolidated ExxonMobil assets, creates the conditions for a potential revision of the dividend policy. Financial projections suggest that Seplat could double its dividend payout ratio in this new cycle, providing Heirs Energies with substantially higher yield returns. These increased dividends, alongside the direct operational revenues from OML 17, form the requisite financial mechanism to service and retire the acquisition debt.

Cynthia Ebot Takang, Idriss Linge