Korean Firm Joins Bid for Addax Petroleum By Ejiofor Alike

Korean National Oil Com-pany (KNOC) has joined China 's SINOPEC in the competition for the take-over of Addax Petroleum in a bid worth over $8 billion.
THISDAY had reported that SINOPEC was negotiating with Addax for the acquisition of the company’s assets. Addax operates in Africa and Middle East with a market capitalisation of $6.1 billion.
Founded in 1994, the company has oil and gas projects in Nigeria, Gabon , Cameroon , and exploration licenses in the Kurdistan region of Iraq .
Addax Petroleum also has interests in four highly prospective properties in the deepwater Nigeria-São Tomé Joint Development Zone (JDZ) including a 45.5 per cent participating interest in and operatorship of Block 4; a 15 per cent participating interest in Block 3, a 14.33 per cent participating interest in Block 2 and a 40per cent participating interest in Block 1.
The company said in a statement that it had held “preliminary discussions” with third parties that had shown interest in transaction with the company.
It said: “Addax Petroleum Corporation has been made aware of press speculation involving the Corporation and the interest in it by third parties with respect to a possible acquisition or business combination.
"In response to that press speculation, Addax Petroleum acknowledges that it has held preliminary discussions with third parties expressing an interest in a potential transaction with the Corporation. While such preliminary discussions are ongoing, no assurance can be given that a transaction will be completed. Addax Petroleum does not intend to make further comment unless or until there is a transaction to announce.”
Both KNOC and SINOPEC intend to use the acquisition to make an inroad into Nigeria’s oil and gas sector, where over 70 per cent of Addax operations are concentrated.
SINOPEC has a participating interest in Oil Mining Licence (OML) 64 operated by the Nigerian National Petroleum Corporation (NNPC) in Delta State .
However, attempt by KNOC to have a stake in two oil blocks in the country suffered major setback when the Federal Government in January revoked the exploration licences awarded to a consortium, which includes KNOC, Daewoo Shipbuilding and Korea Electric Power Corporation by the former administration of President Olusegun Obasanjo in 2005.
The revocation is a subject of litigation at a Federal High Court in Abuja .
THISDAY gathered that ownership of all oil fields assets belonging to Addax Petroleum would be transferred to any of the two companies that eventually wins the bid.