African Export-Import Bank (Afreximbank) and Heir Energy Limited have announced a $750 million financing partnership aimed at optimizing Heir Energy’s capital structure and unlocking critical liquidity to support its working capital requirements as it pursues an ambitious sector development program. This investment is expected to transform Nigeria’s domestic energy capacity as demand increases.
According to Afreximbank, the dual-tranche senior secured accrual-based financing facility, signed by Afreximbank President and Chairman of the Board of Directors George Elombi and Hiers Energies Limited Chairman Tony Elumelu at a ceremony in Abuja, will support the company’s accelerated growth strategy as it enters a new expansion phase aimed at increasing and sustaining oil and gas production.
Afreximbank has been appointed as the delegated lead arranger, facility agent and security agent under this financing. This is considered an important milestone in the strategic cooperation between Afreximbank and Heirs Energies.
“Without investments like the one being provided to Heir Energy, many African economies that rely on fossil fuels will face dire economic challenges,” Elonbi said. “Our aim is, above all, to empower African entrepreneurs. Our core strength lies in the value of the partnerships we continue to build.”
The President reaffirmed Afreximbank’s commitment to realizing the African Energy Bank project, saying: “We should go further and acquire an energy bank so that we can move most of our energy portfolio there. We will deploy significant capital to be as bold and innovative as Afreximbank.”
Elonbi added that Afreximbank is keen to work with Heir Holdings and its affiliates to expand into other West African countries such as Ghana and Ivory Coast, as well as other parts of the continent. “Our aim is to spread and support the dominance of African brands across Africa,” he said.
Mr. Elumelu said the transaction is a strong confirmation of what African companies can achieve when backed by disciplined execution and long-term African capital. “This reflects Heir Energy’s successful journey from turnaround to growth and reinforces our belief that African capital is working for African companies. This is Africa financing Africa’s future,” Elumelu said.
The partnership between Afreximbank and Heirs Energies Limited dates back to 2021, when the company, then known as Heirs Oil & Gas, completed the landmark acquisition of a 45 per cent participating interest in the OML 17 joint venture in a US$1.1 billion deal financed by a consortium of international and local banks led by Afreximbank, making it one of the most significant indigenous energy acquisitions in Nigerian oil. and the gas department.
Afreximbank participated with up to US$250 million of its financing, noting that this underlines its commitment to Africa’s energy sector development and its mission to foster intra-African trade and the growth of African-owned enterprises.
Since this acquisition, crude oil production has increased from approximately 25,000 barrels per day to an average of 50,000 barrels per day, with significant associated and non-associated gas production increases. Heir Energy also achieved first gas deliveries from the Agbada Non-Associated Gas Plant on November 21, 2021, just months after taking over the asset, which had been under construction for more than a decade under the previous operator.
Currently, Heirs Energies is the main gas supplier for the eastern domestic network. It supplies gas to three major power plants, which collectively contribute about 15% of Nigeria’s installed power generation capacity.
