Cameroon's National Hydrocarbons Corporation: Announce in CM Matter

Cameroon's National Hydrocarbons Corporation (SNH) has written down CFA10.8 billion on its stalled acquisition of a 10% stake in Cameroon Oil Transportation Company (Cotco). The impairment represents 40% of the amount committed to Savannah Midstream Investment Limited, a subsidiary of Savannah Energy, under an agreement signed in April 2023. The transaction's completion has been delayed for nearly three years, casting uncertainty over the receivable's value and conditions for recovery.

Cameroon's National Hydrocarbons Corporation (SNH) has recognized a CFA10.765 billion impairment on its still-unfinished acquisition of a 10% stake in Cameroon Oil Transportation Company (Cotco). The state-owned company recorded this financial risk in its 2025 financial statements, reflecting greater uncertainty over the receivable's value and conditions for recovery. This development matters as it highlights the complexities and risks associated with large-scale business transactions in Cameroon.

The acquisition of Cotco's shares was agreed upon on April 19, 2023, between SNH and Savannah Midstream Investment Limited, a subsidiary of Savannah Energy. However, nearly three years later, the final transfer of the stake has yet to be completed. This delay has led to an impairment of CFA10.765 billion, representing 40% of the amount committed under the agreement.

The SNH's decision to write down the value of its receivable from Cotco raises questions about the viability and enforceability of business agreements in Cameroon. The fact that a significant portion of the transaction's value has been impaired suggests that there may be underlying issues with the deal or the parties involved. This development also highlights the need for greater transparency and clarity in large-scale business transactions to mitigate risks and ensure successful outcomes.

The SNH's recognition of a CFA10.8 billion impairment on its Cotco stake purchase underscores the importance of careful planning, risk assessment, and due diligence in business transactions. Practitioners should take note of this development and consider its implications for future deals in Cameroon. It remains to be seen how this situation will unfold and what steps SNH will take to recover or complete the transaction.