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Key Points
- The acquisition boosts Seplat's production to 120,000 barrels daily, solidifying its leadership in Nigeria’s energy sector.
- Seplat financed the deal through cash reserves and debt facilities, avoiding new equity issuance and demonstrating financial discipline.
- The Nigerian government’s approval aligns with economic goals, positioning Seplat as a sustainable energy leader in Africa.
Seplat Energy, co-founded by Nigerian energy tycoon Austin Avuru, has concluded its $800 million acquisition of ExxonMobil’s Nigerian operations, marking a transformative milestone for the indigenous oil and gas powerhouse.
The deal, finalized with the approval of the Nigerian Federal Government, strengthens Seplat’s leadership in the country’s energy sector and enhances its global standing.
The acquisition, initially valued at $1.28 billion, was recalibrated to $800 million, demonstrating Seplat’s strategic and disciplined negotiation approach.
Expanded capacity and enhanced profitability
The acquisition, slated for completion by Dec. 12, 2024, will more than double Seplat’s production capacity to 120,000 barrels of oil equivalent per day.
This expansion positions the company as a key driver of Nigeria’s energy sector, unlocking substantial growth and profitability potential.
Under the revised terms, ExxonMobil will receive $672 million at closing, following a $128 million deposit paid in 2022.
The remaining $257.5 million deferred payment, due in December 2025, will cover decommissioning and joint venture (JV) costs, partially offset by JV cash calls.
The deal was funded entirely through Seplat’s cash reserves and existing debt facilities, avoiding new equity issuance.
Seplat will gain a 40 percent stake in four oil mining leases, a 51 percent interest in the Bonny River gas plant, and 9.6 percent in the Aneman-Kpono field.
Additionally, 1,000 employees and 500 contractors from ExxonMobil will transition to Seplat.
Seplat strengthens base, boosts investor trust
Seplat, co-founded by Austin Avuru and Ambrosie Orjiako, has cemented its position as a key player in Nigeria’s energy industry. With this acquisition, the company not only strengthens its operational base but also boosts investor confidence.
The Nigerian government’s endorsement of the deal aligns with its broader economic objectives, cementing Seplat’s role as a pivotal player in driving energy innovation and sustainability.
This acquisition not only bolsters Seplat’s operational capabilities but also attracts international investors eager to tap into Africa’s vibrant energy landscape.
