Heritage Oil Plc ("Heritage" or the "Company") (TSX:HOC)(LSE:HOIL), an independent upstream exploration and production company announces that a wholly owned subsidiary has entered into a joint venture agreement with Bayelsa Oil Company Limited ("Bayelsa Oil Company"), owned by the Bayelsa State government, to establish an indigenous Nigerian oil company called Petrobay Energy Limited ("Petrobay"). Through Petrobay, Heritage expects to be a significant contributor to the future development of the oil and gas industry in Nigeria.
A wholly owned subsidiary of Heritage has entered into a joint venture agreement to establish Petrobay, an indigenous Nigerian oil company. Heritage will obtain a 45% equity interest in Petrobay which combines Bayelsa Oil Company's network of longstanding relationships in Nigeria with Heritage's strong technical track record, diverse geographic expertise and financial capability. A number of upstream assets in the state of Bayelsa and the larger Niger Delta region have been identified and Petrobay will engage in both bilateral and competitive auction processes to acquire these licences.
Petrobay will enable Heritage to build upon its current interests in Nigeria, which is Africa's largest oil producer and contains the second largest oil reserves in the continent. Heritage's footprint in Nigeria was established in November 2012 on the completion of the acquisition of a major interest in OML 30 through its interest in Shoreline Natural Resources Limited ("Shoreline"). Shoreline acquired a 45% interest in OML 30 for cash consideration of $850 million, with the National Petroleum Development Company holding the remaining 55% interest. OML 30 is located onshore in the Niger Delta, contains eight producing oil fields and has independently been evaluated to contain gross proved and probable reserves of over 1.1 billion barrels, thereby containing some of the largest onshore oil reserves in the country.