… Says Seplat- Mobil Deal Undergoing Final Review
The Nigerian Upstream Petroleum Regulatory Commission has said that the purchase of a 100 per cent stake in Nigerian Agip Company Ltd by Oando Petroleum and Natural Gas Company Limited and other divestments of International Oil Companies (IOC) were conducted in line with the Petroleum Industry Act 2021.
The commission said this on Monday in a statement on the update of the conduct of the divestments of IOC assets, signed by the Head of Public Affairs Unit, Mrs. Olaide Shonola.
The regulator said it is conducting all divestments in line with international standards.
The NUPRC said ongoing divestments are the NAOC-Oando and Equinor–Chappal and Seplat-Mobil Producing Nigeria Unlimited (MPNU) among others.
Former Vice President, Atiku Abubakar had alleged foul play in the purchase of Agip by Oando after the firm announced the successful completion of its acquisition of 100 per cent of Nigerian Agip Oil Company Limited’s shares.
To clarify the deal, the NUPRC said the consent to Oando and Chappal Energies were fulfilled according to regulatory processes.
NUPRC said, “As the public may be aware, ministerial approval was recently granted to the divestment by NAOC to Oando Petroleum and Natural Gas Company Limited (Oando PNGCL) and OANDO Oil II Cooperatief U.A. (OANDO Cooperatief) (together the “Oando Entities”) and by Equinor Nigeria to Chappal Energies.
“The commission wishes the public to be aware that the approvals given to the NAOC-Oando and Equinor–Chappal divestments were in accordance with the Petroleum Industry Act (PIA) 2021, defined regulatory framework, and standard consent approval process set by the commission under the PIA.
“The commission wishes to assure the public that the process for approving divestment applications is guided by the provisions of the PIA and clearly defined frameworks in the assignment regulations, guided by international best practices.”
The Commission further explained that in respect to the NAOC Divestment, Agip by a letter of May 16, 2023, notified the Commission of its intention to proceed with the divestment of participating interests in some of its oil and gas assets.
NUPRC in a letter dated May 21, 2023, said it requested NAOC to provide information on the proposed assignee, adding that NAOC by another letter dated July 24, 2023, notified the Commission that it had completed the technical evaluation of the companies shortlisted for the proposed transaction and submitted OANDO PNGCL and OANDO Coöperatief as qualified companies for the consideration of the NUPRC.
NUPRC explained, “In line with its processes, the Commission by a letter dated December 14, 2023, requested the information contained in the Commission’s due diligence checklist on the transaction and NAOC by a letter dated January 10, 2024, provided the information requested via the Commission’s letter dated December 14, 2023.
“Consequently, the process was conducted in compliance with the requirements of relevant legislations, regulations and guidelines including the Petroleum Act, Petroleum Industry Act, Petroleum Drilling and Production Regulations, and the Upstream Asset Divestment and Exit Guidance Framework. The Divestment Framework evaluated the divestments based on Technical Capacity, Financial Viability, Legal Compliance, Decommissioning and Abandonment, Host Community Trust and Environmental Remediation, Industrial Relations and Labour Issues, as well as Data Repatriation.
“Additionally, NAOC obtained a waiver of pre-emption and consent to the divestment from NNPC, their partner on the blocks. The Commission subsequently made recommendations to the Honourable Minister of Petroleum Resources based on comprehensive assessments which covered the timeline for review of application under the PIA and the Commission’s regulatory process.”
The commission said the Equinor-Chappal divestment followed the same regulatory process.
Atiku had also questioned the delay in the divestment of MPNU but the regulator clarified that the deal was delayed because MPNU failed to obtain a waiver of pre-emptive rights as well as the consent of NNPC Ltd, its partner on the blocks to the divestment.
NUPRC added, “It is worth pointing out that NNPC’s right to pre-emption and consent under the NNPCL/MPNU Joint Venture Joint Operating Agreement was the subject of Suit No: FCT/HC/BW/173/2022 Nigerian National Petroleum Company Limited versus Mobil Producing Nigeria Unlimited, Mobil Development Nigeria Inc., Mobil Exploration Nigeria Inc. and Nigerian Upstream Petroleum Regulatory Commission.
“In June 2024, NNPC and MPNU resolved their dispute with NNPC, and MPNU, by letter dated 26 June 2024 informed the Commission of the resolution of the dispute. Upon resolution of this dispute, the Commission communicated its no-objection decision to the assignment via a letter dated July 4, 2024 and requested MPNU to provide information and documentation required under the Commission’s due diligence checklist to enable the Commission conduct its due diligence as required under the PIA. MPNU by letter dated 18 July 2024 provided the information requested by the Commission.”
The regulator revealed that MPNU’s application to the commission for consent is currently undergoing due diligence review, under the same Divestment Framework applied to the NAOC-Oando and Equinor-Chappal divestment.
“The Commission’s due diligence process is ongoing and within the 120-day timeline required by the PIA,” it added.