ExxonMobil’s $1.3 Billion Asset Sale to Seplat Approved

In his October 1 address to the nation, President Bola Tinubu pledged that the ExxonMobil-Seplat transaction would receive government approval within days. fulfilling that pledge, NUPRC has now confirmed the approval. Gbenga Komolafe, the CEO of NUPRC, stated that the transaction had received full ministerial consent, marking the completion of a deal that had been delayed for over two years.

ExxonMobil Shifts Focus to Offshore Expansion

The approval allows ExxonMobil to shift its focus from onshore operations to the development of its offshore assets in Nigeria.

According to Bloomberg, ExxonMobil is planning to invest up to $10 billion in expanding its offshore portfolio over the coming years, a move that aligns with the company’s long-term strategy for growth in Africa’s largest crude-producing nation.

Seplat Energy to Boost Production Significantly

For Seplat Energy, this acquisition represents a major leap forward. The company had previously stated that acquiring ExxonMobil’s assets would nearly quadruple its oil production capacity, pushing output to over 130,000 barrels per day. The purchase includes a 40% interest in four oil mining leases, as well as key infrastructure like the Qua Iboe export terminal. In addition, Seplat will hold a 51% stake in the Bonny River natural gas liquids recovery plant.

Chevron Deal Rejected as Shell Faces Setbacks

While the ExxonMobil-Seplat deal moves forward, a similar transaction involving Shell Plc’s onshore assets has been rejected by Nigerian authorities. The proposed $1.3 billion deal between Shell and a consortium of local companies led by Renaissance has been delayed for more than three years, primarily due to regulatory hurdles and environmental concerns.

According to NUPRC, the rejection of Shell’s deal is a significant setback for the oil giant, which has faced mounting challenges with its onshore operations, including allegations from local communities accusing the company of contributing to oil spills.

Shell has attributed many of these incidents to oil theft and sabotage. Despite this, the company remains in discussions with the Nigerian government to finalize the sale of its assets.

Future Outlook: Nigeria’s Energy Sector Transformation

The approval of ExxonMobil’s asset sale to Seplat and the rejection of Shell’s deal highlight the ongoing transformation within Nigeria’s energy sector. As ExxonMobil pivots toward offshore investments and Seplat Energy ramps up its production capabilities, the landscape of Nigeria’s oil and gas industry is poised for significant changes.

With major investments on the horizon and regulatory reforms underway, Nigeria’s oil and gas sector is entering a new phase of development, one that could reshape the nation’s position in the global energy market.