Oil field Thar Jath in Unity State, South Sudan. (Photo: Courtesy).

UK company – Savannah Energy reportedly signed an agreement to acquire the entire oil assets of Malaysian company Petronas in South Sudan for a total sum of $1.25bn US dollars.

This comes after the government revealed last evening that Petronas has decided to pull out of South Sudan after 24 years of service to the country’s oil sector.

According to Offshore Technology, Savannah will buy Petronas Carigali – a subsidiary of the Malaysian oil giant company.

Savannah will also acquire interests in three joint operating companies that operate Block 3/7, Block 1/2/4, and Block 5A.

The assets covered under the transaction include interests in 64 producing fields.

Offshore Energy reports that Petronas’ assets in South Sudan reported had a gross production rate of 153,000 barrels of oil equivalent per day in 2021.

“The transaction consideration is expected to be financed through a combination of the enlarged group’s available cash resources and debt,” Savannah Energy said in a statement.

“The transaction is conditional upon the satisfaction of certain conditions precedent, including inter alia, approval of the Government of the Republic of South Sudan, the approval of Savannah’s shareholders, and re-admission to trading on AIM taking effect.”

The government has not yet commented to confirm the reports of Savannah takeover.

But on Sunday, December 18, the Minister of Presidential Affairs Dr. Barnaba Marial Benjamin said he has led a delegation to the Petronas headquarters in Malaysia – to understand the reason for their exit.

Speaking to the state-owned television – SSBC, the minister said he will brief the president and the cabinet on the outcome of their meeting and the company’s decision.

“So this delegation had to go the Petronas headquarters so that we discuss and understand the reason that makes Petronas ask the government of South Sudan to exit from the oil responsibilities that they have been carrying out for the last 24 years,” said Marial.

“We have had a wonderful discussion and indeed we shall brief the president and the Council of Ministers on how the talks went ahead. We believe this is an issue that involves the mutual interest of both parties.”

However, Marial did not disclose either the reason for the departure of the Petronas or the outcome of the talks.

It is also not clear if the abrupt pull-out will have a significant impact on South Sudan’s oil export which accounts for almost all the revenue generated by the country.

Petronas started investing in Block 5A oilfields of Unity State in 1996, before buying oil assets from Lundin Petroleum at 142.5 million dollars.

Savannah Energy PLC calls itself an independent energy company, and it is active in Africa – especially in Cameroon, Chad, Niger and Nigeria.