Buhari Reverses Approval Of Seplat’s Acquisition Of Exxon Mobil

President Muhammadu Buhari has reversed his earlier approval of Seplat Energy’s acquisition of Exxon Mobil Nigeria subsidiary, Mobil Producing Nigeria Unlimited (MPNU).

Presidential spokesperson Garba Shehu who disclosed this said the reversal was to support the position of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) which is against the deal.

“It has become clear that the various agencies involved in decision had not coordinated well among themselves and having looked at all of the facts with all of the ramifications, the president decided the position of the regulator is to be supported,” Garba Shehu told Premium Times.

OduNews reports that NUPRC had on Monday said the proposed takeover of Mobil Producing Nigeria Unlimited by Seplat, an indigenous oil firm, was a regulatory matter and it had notified ExxonMobil the transaction could not go through.

“As it were, the issue at stake is purely a regulatory matter and the Commission had earlier communicated the decline of Ministerial assent to ExxonMobil in this regard. As such the Commission further affirms that the status quo remains,” said a statement by NUPRC chief executive, Gbenga Komolafe.

“The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) affirms that status quo remains in respect of ExxonMobil/Seplat Energy share acquisition. Responding to media enquiries on latest development about the transaction, the Chief Executive of the NUPRC Engr. Gbenga Komolafe clarified that the Commission in line with the provisions of the Petroleum Industry Act 2021 is the sole regulator in dealing with such matters in the Nigerian upstream sector.

The statement came a few hours after presidential spokesperson Femi Adesina said Mr Buhari had approved the sale to Seplat.

Mr Adesina said Mr Buhari approved the transfer in his capacity as Minister of Petroleum Resources and the approval was in consonance with the country’s drive for Foreign Direct Investment in the energy sector and considering the “extensive benefits of the transaction to the Nigerian Energy sector and the larger economy.”

THE SEPLAT SALE DEAL
ExxonMobil entered into a landmark Sale and Purchase Agreement with Seplat Energy to acquire the entire share capital of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation, Mobil Development Nigeria Inc, and Mobil Exploration Nigeria Inc. earlier this year.

The transaction suffered a setback after the state-owned Nigerian National Petroleum Corporation Limited asserted a right of first refusal on the deal. As a joint venture partner, NNPC argued it retained the right to be allowed to buy oil blocks sold by ExxonMobil ahead of any competitor or private firm.

Seplat Energy in July said NNPC Ltd. won a court decision to block its quest to purchase the entire oil assets of Mobil Producing Nigeria Unlimited (MPNU), a local unit of oil major ExxonMobil.

The court decision on July 6 was temporary and forbade MPNU and the defendants from consummating any asset disposal in MPNU, not excluding the share sale and purchase deal it struck with Seplat in February.

NNPC had prayed the court, State High Court of the Federal Capital Territory, to declare that a conflict happened between the state-owned oil company and MPNU over the “interpretation of preemption rights under their Joint Operating Agreement (“JOA”) and order NNPC and MPNU to arbitration as required by the JOA.”

Seplat Energy said neither itself nor Seplat Energy Offshore Limited was a party in the lawsuit, and insisted the share purchase agreement remained valid. The asset purchase would enable Seplat Energy to scale up production by 95,000 barrels of oil a day from assets in a joint venture ExxonMobil runs with NNPC.