Why NNPC Stopped Exxon Mobil’s Asset Sale To Seplat

Exxon Mobil Corporation’s plan to sell its assets in Nigeria to Seplat Energy Plc has been halted by the Nigerian National Petroleum Company Limited.

According to Blomberg, this happened after NNPC went to court.

NNPC got an order by a judge in Abuja stopping Exxon “from completing any divestment” in a unit that ultimately operates four licenses in Nigeria.

Seplat which is based in Lagos State had taken steps to take over the United States oil major’s subsidiary for at least $1.28bn in February.

It was reported that NNPC stopped Exxon from selling its assets to Seplat because it wants to take over the permits itself.

Bloomberg stated that NNPC sued Mobil Producing Nigeria Unlimited on July 5, 2022, asking the Federal High Court either to order that a dispute had occurred between the parties over preemption rights, or to order them to take the matter to arbitration, quoting a statement from Seplat.

Seplat, which was not a party to the lawsuit, said its deal with Exxon was “still valid” and the company “remains confident that the matter will be brought to a proper conclusion by the law.”

If Seplat acquires Exxon’s property, it would give the company additional production of about 95,000 barrels of oil equivalent a day from shallow-water assets that Exxon operated in a joint venture with NNPC.

For more than a decade, international oil companies active in Nigeria have been offloading large parts of their portfolio across the country to domestic players, a trend that has recently accelerated.

An order from a Nigerian court had also forced Shell Plc to pause its plans to sell all of its remaining onshore permits in Nigeria.