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The Federal Government of Nigeria has declined to approve the proposed acquisition of ExxonMobil’s oil and gas assets in Nigeria by Seplat Energy, an integrated energy company linked to Nigerian businessmen and energy magnate Bryant Orjiako.
Orjiako co-founded Seplat with Austin Avuru in 2009 through the collaboration of Shebah Petroleum Development Company and Platform Petroleum Joint Ventures.
In two separate letters to Richard Laing, chairman of Mobil Producing Nigeria Unlimited, and Ambrosie Bryant Orjiako, the immediate past chairman of Seplat Energy, Nigerian Upstream Regulatory Commission CEO Gbenga Komolafe, acting on behalf of the government, cited overriding national interests as one of the reasons for rejecting the $1.58-billion deal proposed by Nigeria’s leading energy company, Seplat.
The news comes three months after Seplat announced a final agreement to purchase the entire share capital of Mobil Producing Nigeria Unlimited (MPNU) for $1.58 billion, including contingent payment.
The planned $1.58-billion deal includes ExxonMobil’s entire offshore shallow water business in Nigeria, which is a well-established, high-quality operation capable of producing 95,000 barrels of oil per day.
The regulatory body emphasized that, regardless of the mode of the transaction, Mobil Oil remains the assignor of the asset under Nigerian law, noting that the transaction was between parties who were not privy to the joint operating agreement between the Nigerian National Petroleum Company and the MPNU dated June 28, 1990, and that this does not trigger any relevant rights or obligations under the JOA for either the NNPC or the MPNU.
Furthermore, it made reference to another aspect of the letter that Mobil wrote to it on the subject, namely, that the MPNU shareholders would continue their efforts to satisfy the conditions required for the approval of the proposed transaction and the procurement of the minister of petroleum resources’ consent.
According to the regulatory commission, until an assignment is completed, including the granting of ministerial consent to such assignment, the leaseholder remains the registered owner of the asset and the only person with the locus to interact with the government regarding the asset.
