Russia's Lukoil has joined Italy's Eni in a producing licence off Congo-Brazzaville after buying out NewAge’s stake in an all-cash deal worth $800 million.

Lukoil has taken the privately held player’s 25% interest in the Marine XII licence that is operated by Eni and hosts five discoveries, including the large producing Nene field.

Nene is a phased development, with both phase one and phase 2A already online and phase 2B scheduled to come online in the second half of the year.

Apart from Nene and Litchendjili, which both came online in 205, the four-block tract hosts the Banga, Minsala and Nkala fields.

Marine XII is situated 20 kilometres from shore in water depths of just 20 to 90 metres, extending over 571 square kilometres.

Lukoil said the two producing fields have current output of 28,000 barrels of oil and gas condensate per day and 1.7 million cubic metres per day of marketable gas.

Research outfit Wood Mackenzie said production at the Marine XII licence will peak at over 100,000 barrels per day by 2025, with a floating liquefied natural gas development in the pipeline.

Chief executive Vagit Alekperov said: "Entering this project is in line with our mergers and acquisitions strategy. The project is characterised by explored reserves, substantial production growth potential, access to well-developed infrastructure and it also fits our technological expertise.

"On top of that, the project is already free cash flow positive." NewAge has not commented on the sale, which will allow it to focus more cash on its Etinde development in Cameroon.

The company also retains a 75% stake in the Marine III licence off Congo-Brazzaville, which covers two exploration blocks.

Jean-Baptiste Bouzard, senior research analyst at WoodMac, said the deal represents a 36% discount to the company’s $1.26 billion valuation as of January this year. “This can be explained by NewAge’s well-known desire to sell and the development costs associated with complex reservoirs,” he said.

“The transaction adds production for the first time to Lukoil’s West African portfolio, and fits with the Russian company’s aims of developing its offshore expertise and grow its presence outside its Russian stronghold.

“For NewAge, the sale will free up resources to focus on Etinde in Cameroon and replenish its exploration portfolio.”

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Lukoil eyes Nene with Congo-Brazzaville deal