ELAND Oil & Gas has secured funding from a major bank which it said had provided a vote of confidence in a key asset in Nigeria in spite of falling oil prices.
ELAND Oil & Gas has secured funding from a major bank which it said had provided a vote of confidence in a key asset in Nigeria in spite of falling oil prices.
Aberdeen-based Eland said it had met all the conditions to access a $22 million (£14m) loan facility agreed with Standard Chartered Bank. The company will draw on the facility to fund work on the OML 40 licence in Nigeria, after starting production on the acreage earlier this year.
The AIM-listed company noted it has mandated Standard Chartered Bank to coordinate work on securing a $75m lending facility it wants to have in place by the year end.
Eland??s chief executive George Maxwell said entering the debt phase of financing was a significant development for the company. It allows Eland to progress the further development of its assets without the requirement to raise equity funding from shareholders.
He added: ??In a current economic environment of falling oil price, where financing and capital expenditure plans are being cut or deferred, the commitment from Standard Chartered to coordinate the raise of such a material debt facility ... further validates the significant value of the OML 40 license.??
Last month Eland said it can make significant profits on its output in Nigeria in spite of the fall in oil prices since June.
On 24 November the company said the Opuama field on the OML 40 licence had achieved an average uptime of around 90 per cent in the month.
Announcing interim results in August, Eland noted there had been a number of production interruptions since it brought Opuama onstream in February this year. These reflected factors including theft from pipelines through illegal bunkering.
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