Nestoil, the oil service firm owned by Nigerian businessman Ernest Azudialu, is reportedly angling to sell part of its equity in the Neconde Special Purpose Vehicle (SPV) according to Africa Oil + Gas Report.

As such, it will be farming down in its partnership in the Oil Mining Lease (OML) 42, located in the Western Niger Delta. Nestoil holds 80% of Neconde. The Neconde SPV took over Shell/TOTAL/ENI’s 45% stake in the acreage in 2012. The majority 55% is held by NNPC, the state hydrocarbon company.

Creating value from the asset takeover has however been an epic struggle due to several factors ranging from low oil prices and poor operations to militancy. While Neconde paid $585million to buy the 45%, it has found it difficult to reach and stay on an optimum output, at an optimum price, to pay back debts and fund a sorely needed expansion.

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