Nigeria-Focused Junior Suspends Shares After Loan Questions

Nigeria-focused junior Lekoil suspended its shares on the London stock exchange January 13, because of questions about the validity of a loan deal with the Qatari Investment Authority (QIA).

The company said in a stock filing it had been approached on January 12 by QIA representatives “questioning the validity” of an agreement it reported reaching with the sovereign fund on January 2 for a $184mn loan. The loan was to cover appraisal and development at the Ogo oil and gas discovery off Nigeria.

Lekoil said it was seeking “full facts” of the matter, and in the meantime had successfully requested that its shares be suspended. The company noted it had already paid $600,000 in “good faith” to Seawave Invest, which arranged the QIA financing and covered legal fees.

The 2013 Ogo discovery lies in the Keta-Togo-Benin basin and has 774mn boe in gross recoverable resources, according to Lekoil. The company and its Lagos-based partner Optimum Petroleum Development agreed to move ahead with appraisal work last year.