NNPC battles Seplat oil over US ExxonMobil, indicates interest

Seplat Energy’s plans to buy out ExxonMobil’s shares in its Nigerian unit Mobil Oil Producing Nigeria Unlimited (MPNU) is seriously in trouble as Nigerian National Petroleum Company (NNPC) has also indicated interest.

Reports have it that NNPC Limited has decided to take up its option of right to first refusal and now wants ExxonMobil’s entire assets in Nigeria’s onshore and shallow waters.

The Sale and Purchase Agreement (SPA) deal which is worth a whopping $1.283 billion, plus up to $300 million contingent consideration is to acquire the entire share capital of MPNU as the US company looks to exit Nigeria.

A report published by Platforms Africa, a news, business and leadership medium, stated that the state-owned oil giant had opted to exercise its Right of First Refusal (RFR) on the sale of the assets.

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The RFR is reportedly contained in the Joint Operating Agreement (JOA) of the Joint Venture (JV), which represents NNPC’s position on the planned sale of the shares to Seplat Energy Plc.

According to a source, “Seplat bought ExxonMobil’s shares, not assets. Whereas NNPC has right of pre-emption over the sale of assets, it does not have right over sale of shares.”

Furthermore, the source explained that with its present structure, NNPC was now a commercial entity and no longer a regulator, as it used to be in the past, “so, it is the regulator that can interfere in the matter.”

The source added, “However, they have to check the Production Sharing Contract (PSC) because if they say they are taking over ExxonMobil, that means they are taking over staff, pensions and liabilities and not assets.”