By Adedapo Adesanya
The Nigerian National Petroleum Company (NNPC) Limited has announced the signing of a settlement agreement facilitating the divestment of ExxonMobil’s stake in Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Plc.
According to a statement released on Thursday by NNPC Limited, the agreement involves MPNU, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc.
“Settlement agreement between NNPC Ltd. and Mobil Producing Nigeria Unlimited, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc. signed regarding the proposed divestment of a 100 per cent interest in Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited,” NNPC stated.
This development comes after a directive from President Bola Tinubu to the Ministry of State for Petroleum Resources (Oil) and NNPC on May 28 to resolve the divestment issue that had stalled the Seplat and ExxonMobil deal for over two years.
President Tinubu had assured the ExxonMobil delegation that the federal government was committed to resolving the divestment issues between the state oil firm and Seplat Energy.
On his part, the Minister of State for Petroleum Resources (Oil), Mr Heineken Lokpobiri stated, “Mr. President has given a clear directive to the NNPC GCEO and I to resolve the issue of divestment, and we are doing whatever we can to achieve that.”
Mr Lokpobiri had earlier revealed that Nigeria lost $34 billion in the last two and a half years due to the fall in production from the assets being divested by ExxonMobil to Seplat Energy.
He said assets declined from 600,000 barrels per day to the current 120,000 barrels per day, leaving a shortfall of 480,000 barrels per day, which he said amounted to a $34 billion loss at a conservative $80 per barrel, in the last two and a half years.
In February 2022, Seplat announced an agreement to acquire ExxonMobil’s 40 per cent stake in MPNU, expecting the transaction to be completed in the second half of the year.
However, on May 19, 2022, the Nigerian Upstream Petroleum Regulatory Company (NUPRC) declined to approve Seplat’s proposed acquisition, citing “overriding national interest.”
Two months later, Seplat reported that NNPC had secured a court injunction preventing ExxonMobil from selling its assets in Nigeria.
This opposition led former President Muhammadu Buhari to reverse his initial authorization for the acquisition on August 10, 2022, shortly after approval.
Amid the delay in securing approval, Seplat extended the share sale and purchase agreement (SSPA) with ExxonMobil for the acquisition of its stake in MPNU in May 2023. On May 17, Seplat indicated progress in acquiring MPNU assets, and a week later, the company extended the SSPA again.
With the recent signing of the settlement agreement, Nigeria could add at least 700,000 barrels per day to its current daily crude oil production volume, to hit about two million barrels per day before the end of the year.