Yemisi Izuora/Joseph Bakare/Agency Report
Shoreline Group, a Nigerian company with interests in oil and gas operating in six African countries, is planning to sell $2 billion in debt to buy crude and gas assets on the continent.
The company is eyeing assets purchases in Equatorial Guinea and Tanzania.
The debut issue of as much as $500 million of five- to seven-year Eurobonds will probably happen before the end of the year, Chief Executive Officer Kola Karim said in in Lagos on June 2.
He was speaking after a two-week roadshow in the U.S. and Middle East, arranged by two international banks he declined to identify.
“The winner of this market is going to be the guy who has access to not only local, but international capital.
I’m bullish about gas and gas infrastructure. If this country is going to grow that’s going to be huge,” said Karim.
Shoreline is seeking to profit from an energy deficit in Nigeria, where homes and businesses rely on generators rather than grid power, which works for only a few hours a day if at all.
That has created a gap that can be filled by Shoreline, whose operations span infrastructure and engineering, power and telecommunications.
Founded in 1997, Shoreline produces about 60,000 barrels of oil a day, with crude accounting for around 60 percent of its overall business, he said.
Shoreline is one of at least five local businesses that bought fields in the Niger Delta region after foreign companies including Royal Dutch Shell Plc, Total SA and Eni SpA sold onshore assets.
More than a dozen small indigenous producers account for about 20 percent of Nigeria’s production of 1.9 million barrels a day.
Investors would be keen to “back the right horse” even after a drop of more than 40 percent in crude prices over the past year, Karim told Bloomberg.
Karim said he has approached all three major international ratings companies and is looking to sell the $2 billion of bonds in three or four tranches.