The Nigerian National Petroleum Company Limited (NNPC Ltd.) on Thursday announced the signing of a settlement agreement facilitating the divestment of ExxonMobil’s stake in Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Plc.
This is coming two years after the divestment plan was announced. The NNPC Ltd., in a statement, said the agreement involved MPNU, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc.
“A settlement agreement was signed between NNPC Ltd. and MPNU, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc. regarding the proposed divestment of a 100 percent interest in MPNU to Seplat Energy Offshore Limited,” the NNPC stated.
This development comes after a directive from President Bola Tinubu to the Ministry of State for Petroleum Resources (Oil) and NNPC Ltd. on May 28, to resolve the divestment issue that stalled the Seplat and ExxonMobil deal over two years.
Tinubu had assured the ExxonMobil delegation that the Federal Government was committed to resolving the divestment issues between NNPC Ltd. and Seplat Energy.
Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri said the President had given a clear directive to him and the NNPC Ltd. Group Chief Executive Officer, Mal Mele Kyari to resolve the issue of divestment, which they were doing their best to achieve.
He said the assets declined from 600,000 barrels per day (bpd) to current 120,000bpd, leaving a shortfall of 480,000bpd. This, he said, amounted to 34 billion dollars loss at a conservative 80 dollars per barrels, 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 Commission (NUPRC) declined to approve Seplat’s proposed acquisition, citing “overriding national interest.”
Two months later, Seplat reported that NNPC Ltd. had secured a court injunction preventing ExxonMobil from selling its assets in Nigeria. This opposition led former President Muhammadu Buhari, to reverse his initial authorisation for the acquisition on August 10, 2022, shortly after granting 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.
