Nigerian President Muhammadu Buhari has granted consent to the acquisition of Exxon Mobil’s Nigerian unit by Seplat Energy in a $1.28 billion deal announced in February.
Buhari, who doubles as oil minister, granted ministerial approval to the deal, the presidency said in a statement on Monday.
Exxon and Seplat are expected to operate the unit’s oil licenses, supporting Nigeria meet its OPEC production quota in the short term as well as accelerate the development of gas resources in the area.
Seplat is listed on the London and Nigerian stock exchanges.
Seplat said in February its offshore unit had entered an agreement to buy the entire share capital of Exxon’s Nigerian offshore shallow water business for $1.28 billion, plus a further consideration of up to $300 million based on the oil price and the average production of the unit, Mobil Producing Nigeria Unlimited, over a five-year period.
ExxonMobil has agreed to sell its shallow-water assets in Nigeria to Seplat Energy for $1.28 billion plus a contingent consideration of $300 million. Seplat said it is acquiring a 40% operating stake in four oil leases to nearly triple its annual net production to 146,000 BOE/D.
The deal also includes the Qua Iboe export terminal and a 51% interest in the Bonny River Terminal and natural gas liquids recovery plants at EAP and Oso. It does not include any of ExxonMobil’s deepwater fields in Nigeria.
ExxonMobil Corporation, had announced that it had reached an agreement to sell its equity interest in its shallow-water business, Mobil Producing Nigeria Unlimited, to Seplat Energy, a Nigerian independent oil and gas company, through its wholly-owned subsidiary, Seplat Energy Offshore Limited.
ExxonMobil, however, said that it would retain its deepwater assets, adding that the sale of MPNU supported the company’s investment strategy and Nigeria’s efforts to enhance industry participation.
It said the transaction would close later this year pending regulatory approvals, according to a statement issued by the Manager, Media and Communications, MPNU, Oge Udeagha.
The President, ExxonMobil Upstream Oil and Gas, Liam Mallon, said, “This sale will allow us to prioritise competitively advantaged investments in our strategic assets, and it supports the Nigerian government’s efforts to grow its oil and gas operations.
“We value the relationships we have spent decades building with the government and people of Nigeria, which will continue as we maximise the value from our deepwater operations.”
The oil firm said when finalised, the sale would include the Mobil Development Nigeria and Mobil Exploration Nigeria equity ownership of Mobil Producing Nigeria Unlimited, which hold a 40 per cent stake in four oil mining licences.
According to the statement, the licences include more than 90 shallow-water and onshore platforms and 300 producing wells.