Griffiths Energy Inc., shunned by investors when it tried to go public earlier this year, has found an international partner with exceptionally deep pockets.
Glencore International Plc, the Swiss commodity and mining giant, has signed an agreement to invest in Griffiths’ energy projects in Chad – the Mangara and Badila oilfields
Glencore, which is taking over Canadian agribusiness Viterra Inc., will put up $300-million (U.S.) to develop Griffiths’ projects, the Calgary-based company said in a statement Tuesday. Glencore will front up to $100-million per year, and in exchange, it will earn a 25 per cent working interest in the Mangara and Badila efforts. Griffiths will hold on to 50 per cent, while Chad’s national energy company, Socie´te´ des Hydrocarbures du Tchad, will have dibs on the remaining 25 per cent.
“This transaction, once closed, allows Griffiths to accelerate the development of the Mangara and Badila oil fields,” Gary Guidry, Griffiths chief executive said in a statement. The company wants the projects to spit out 50,000 barrels of oil per day by the end of 2014.
Nomura International Plc, RBC Capital Markets, and First Energy Capital LLP provided Griffiths with strategic advice on the Glencore