Lekoil Oil and Gas Investments Limited has executed a prepayment facility agreement with Shell Western Supply and Trading Limited (SWST), a member of the Royal Dutch Shell group of companies.
The prepayment facility follows the renewal of the offtake agreement with SWST, which occurred in the second quarter of this year as announced on 26 June 2020, and will provide further short-term liquidity with the proceeds already received.
Also Read: Lekoil Renews Offtake Agreement With Shell
In a statement yesterday, Lekoil said the facility size is $3.5 million and that it has a tenor of five months and charges a market margin over LIBOR. “The facility is repayable from future crude oil liftings. With the receipt of this facility, the offtake agreement between SWST and LOGL has been extended for an additional year and will now expire on 28 April 2022,” the company stated.
The CEO of Lekoil, Lekan Akinyanmi, said the company is pleased to continue their relationship with Shell as a commercial and financial partner. “Together with the recent cost reduction measures we have undertaken, receipt of the proceeds of this prepayment facility will further strengthen our balance sheet to support execution of our strategy,” he said.
Chibisi Ohakah, Abuja