Nigeria set to approve Seplat's acquisition of ExxonMobil assets within two weeks

The Nigerian government is poised to greenlight ExxonMobil's $1.28bn asset sale to Seplat Energy within the next two weeks, pending resolution on critical issues related to decommissioning and host community rights, local media reported on May 2. 

Gbenga Komolafe, the Executive Secretary of the Nigeria Upstream Petroleum Regulatory Council (NUPRC), noted that ExxonMobil would soon meet NUPRC to agree on those two points. The outcome of this meeting will significantly influence the approval process for the deal, potentially expediting it.

Seplat opened talks in 2021 to buy Mobil Producing Nigeria Unlimited (MPNU) for approximately $1.3bn, at which time a contingent consideration of $300mn was also agreed. The deal has been stalled by the Nigerian National Petroleum Company Limited (NNPCL), which has a 60% ownership stake in the fields, took legal action against MPNU and the NUPRC, saying it has pre-emptive rights.

Acquiring MPNU would give Seplat ownership of important assets and the ability to operate the Qua Iboe Terminal, a key export location for top-grade Nigerian oil.

Komolafe did not explicitly describe what ExxonMobil would have to agree to but did note that Nigerian law requires money to be set aside for decommissioning, host community development and environmental remediation.

“As a commission, we don’t want our nation to carry unwarranted financial burdens arising from the operations of the assets over time by the divesting entities,” Komolafe said.

The impending approval of the ExxonMobil-Seplat deal comes after a protracted regulatory saga. Initially approved by former President Muhammadu Buhari, the acquisition has faced regulatory hurdles from the NUPRC.

Seplat Energy, Nigeria’s biggest oil & gas company by market value, made NGN885.1bn ($547mn) in total comprehensive income in 2023, the company revealed on February 29.