Victor Ezeja
AdminSeplat Energy Wednesday expressed optimism on finalizing talks that will allow it to conclude the deal to purchase ExxonMobil’s offshore shallow water assets. This is as the regulator, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is “very optimistic” that the sale of ExxonMobil’s business to Seplat is headed in the right direction.
Prime Business Africa reports that the acquisition is key to actualising the most ambitious move ever by Seplat, which is Nigeria’s biggest energy company by market value, and is listed in both London and Lagos.
Industry analysts believe that this deal is key to attracting the much-needed investment into Nigeria’s oil and gas sector. Several foreign oil companies are looking to sell their onshore assets in Nigeria, but those transactions have hit legal and regulatory roadblocks one way or the other.
The Seplat-ExxonMobil deal, which had been grounded for nearly two years, is expected to expand Seplat’s production by as much as 186 per cent. It had stalled when NUPRC refused to approve the $1.28 billion sale. The Nigerian National Petroleum Company Limited (NNPCL) had contested the sale at the time, contending that it had first rights to the assets.
Speaking with Reuters on the sidelines of Africa Oil Week in Cape Town, NUPRC chief executive officer, Gbenga Komolafe said, “We are very optimistic that parties to the transaction will go back, look at the position of the regulator and come back by abiding by the provisions of Nigerian laws and the right thing will be done”. He added that once Exxon reaches proper agreements with its joint-venture partners in the assets, “the regulator will do what it needs to.”
Speaking in the same vein, CEO of Seplat, Roger Brown told the news agency that he was “hopeful” the deal could be concluded this year. His words: “We have very good relationships with the regulator and that is why it takes time and the NNPC is a partner to us and we want to respect the partnership. Now we are starting to get to that crux point to try and resolve the issue.”
NNPC Limited, which owns 60 per cent of the local offshore shallow-water operation of Houston-based ExxonMobil, had initiated a legal move against Mobil Producing Nigeria Unlimited and NUPRC, saying pre-emption rights under the joint venture give it the exclusive privilege to discuss the acquisition with ExxonMobil first before other suitors are considered.
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