The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), regulator of Nigeria’s upstream subsector has disagreed with President Muhammadu Buhari over his approval of Seplat Energy’s acquisition of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation.
The deal which was initially announced in February this year was set to follow the well-trodden path of other oil and gas deals in Nigeria which have been subject to lengthy delays – and are sometimes not completed at all – due to the highly litigious nature of Nigeria’s business environment.
The proposed acquisition had been subjected to a series of delays by the government on the deal, for which industry analysts said some government officials were not comfortable with the acquisition by a wholly indigenous oil company.
Federal government had turned down the application for ministerial consent necessary to seal the $1.5bn planned deal between Seplat Energy Plc, a major energy company in Nigeria, and US-based ExxonMobil.
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However, in a statement on Monday, Femi Adesina, presidential spokesperson, said Buhari made the approval considering the ample benefits of the divestment to the country’s oil sector.
“In his capacity as minister of petroleum resources, and in consonance with the country’s drive for foreign direct investment in the energy sector, President Muhammadu Buhari has consented to the acquisition of Exxon Mobil shares in the United States of America by Seplat Energy Offshore Limited,” the statement reads.
However, in a statement by NUPRIC, the regulator insisted that the matter was a regulatory one and nothing had changed after it had earlier notified ExxonMobil the transaction had been declined.
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.
READ ALSO: Buhari overrules NNPC, grants approval for Seplat, ExxonMobil deal
“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.”
The statement, effectively repudiating the presidential decision, came a few hours after presidential spokesperson Femi Adesina said in a statement Mr Buhari had approved the sale to Seplat, an indigenous oil company.
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.