Nigerian regulator rejects Buhari's approval of Seplat's purchase of ExxonMobil assets
Nigeria's upstream oil regulator has contradicted a presidential statement announcing President Muhammadu Buhari's approval of Seplat Energy's acquisition of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said on Monday that this was a regulatory matter and nothing had changed after previously informing ExxonMobil that the transaction had been declined.
“The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) affirms that the status quo remains with regard to the acquisition of ExxonMobil/Seplat Energy shares,” said a statement from NUPRC Director General Gbenga Komolafe.< /p>
“Responding to media inquiries on the latest developments regarding the transaction, NUPRC Managing Director Engr. responsible for addressing such issues in the Nigerian upstream sector.
“The issue at stake, so to speak, is purely a regulatory matter and the Commission had previously communicated the denial of ministerial assent to ExxonMobil in this regard. As such, the Commission further asserts that the status quo remains."
The statement, effectively rejecting the presidential decision, came hours after presidential spokesman Femi Adesina said in a statement that Buhari had approved the sale to Seplat, an indigenous oil company.
Mr. Adesina said that Mr. Buhari had approved the transfer in his capacity as Minister of Petroleum Resources and that this approval was in line with the country's desire to invest directly in the energy sector and taking into account the "considerable advantages of the transaction for the Nigerian Energy sector and the economy as a whole.”
Exxon Mobil has entered into a historic sale and purchase agreement with Seplat Energy to acquire the entire share capital of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation, Mobil Development Nigeria Inc and Mobil Exploration Nigeria Inc. earlier this year.
The deal suffered a setback after state-owned Nigerian National Petroleum Corporation Limited asserted a right of first refusal on the deal. As a joint venture partner, NNPC argued that it retained the right to be allowed to purchase oil blocks sold by ExxonMobil ahead of any competitor or private company.
In July, Seplat Energy declared that NNPC Ltd. had obtained a court order preventing it from buying the entire oil assets of Mobil Producing Nigeria Unlimited (MPNU), a local unit of oil major ExxonMobil.
The July 6 court ruling was temporary and barred MPNU and the defendants from making any divestiture of assets in MPNU, not excluding the share sale and purchase agreement he entered into with Seplat in February.
NNPC had asked the court, the State High Court of the Federal Capital Territory, to declare that a dispute had arisen between the state oil company and the UNPM over "the interpretation of pre-emptive rights in under their Joint Operating Agreement ("JOA") and order NNPC and MPNU to submit to arbitration as required by the JOA."
Seplat Energy said neither itself nor Seplat Energy Offshore Limited was a party to the lawsuit, and insisted that the share purchase agreement remains valid.
The asset purchase would allow Seplat Energy to increase production by 95,000 barrels of oil per day from the assets of a joint venture that ExxonMobil manages with NNPC.
CONTROVERSIAL DECISIONSPREMIUM TIMES has learned that Mr Buhari declined Seplat's offer in favor of NNPC last week, only for a contradictory statement to be released on Monday. Officials said the opposing rulings suggest the president may not have full control over critical state issues and that powerful interests sometimes work through aides to secure favorable rulings, even if they are controversial.
They explained why the president would divest the oil asset to a private company when the government has just commercialized NNPC, making the former regulator an operator and a competitor in the industry.
READ ALSO: Buhari approves Seplat's acquisition of Mobil Nigeria from ExxonMobilMr. Adesina's statement said: "The President, as part of his commitment to invest in light of the Petroleum Industry Act, has given his consent to the Share Sale Agreement, as requested by the parties to the transaction...
Nigeria's upstream oil regulator has contradicted a presidential statement announcing President Muhammadu Buhari's approval of Seplat Energy's acquisition of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said on Monday that this was a regulatory matter and nothing had changed after previously informing ExxonMobil that the transaction had been declined.
“The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) affirms that the status quo remains with regard to the acquisition of ExxonMobil/Seplat Energy shares,” said a statement from NUPRC Director General Gbenga Komolafe.< /p>
“Responding to media inquiries on the latest developments regarding the transaction, NUPRC Managing Director Engr. responsible for addressing such issues in the Nigerian upstream sector.
“The issue at stake, so to speak, is purely a regulatory matter and the Commission had previously communicated the denial of ministerial assent to ExxonMobil in this regard. As such, the Commission further asserts that the status quo remains."
The statement, effectively rejecting the presidential decision, came hours after presidential spokesman Femi Adesina said in a statement that Buhari had approved the sale to Seplat, an indigenous oil company.
Mr. Adesina said that Mr. Buhari had approved the transfer in his capacity as Minister of Petroleum Resources and that this approval was in line with the country's desire to invest directly in the energy sector and taking into account the "considerable advantages of the transaction for the Nigerian Energy sector and the economy as a whole.”
Exxon Mobil has entered into a historic sale and purchase agreement with Seplat Energy to acquire the entire share capital of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation, Mobil Development Nigeria Inc and Mobil Exploration Nigeria Inc. earlier this year.
The deal suffered a setback after state-owned Nigerian National Petroleum Corporation Limited asserted a right of first refusal on the deal. As a joint venture partner, NNPC argued that it retained the right to be allowed to purchase oil blocks sold by ExxonMobil ahead of any competitor or private company.
In July, Seplat Energy declared that NNPC Ltd. had obtained a court order preventing it from buying the entire oil assets of Mobil Producing Nigeria Unlimited (MPNU), a local unit of oil major ExxonMobil.
The July 6 court ruling was temporary and barred MPNU and the defendants from making any divestiture of assets in MPNU, not excluding the share sale and purchase agreement he entered into with Seplat in February.
NNPC had asked the court, the State High Court of the Federal Capital Territory, to declare that a dispute had arisen between the state oil company and the UNPM over "the interpretation of pre-emptive rights in under their Joint Operating Agreement ("JOA") and order NNPC and MPNU to submit to arbitration as required by the JOA."
Seplat Energy said neither itself nor Seplat Energy Offshore Limited was a party to the lawsuit, and insisted that the share purchase agreement remains valid.
The asset purchase would allow Seplat Energy to increase production by 95,000 barrels of oil per day from the assets of a joint venture that ExxonMobil manages with NNPC.
CONTROVERSIAL DECISIONSPREMIUM TIMES has learned that Mr Buhari declined Seplat's offer in favor of NNPC last week, only for a contradictory statement to be released on Monday. Officials said the opposing rulings suggest the president may not have full control over critical state issues and that powerful interests sometimes work through aides to secure favorable rulings, even if they are controversial.
They explained why the president would divest the oil asset to a private company when the government has just commercialized NNPC, making the former regulator an operator and a competitor in the industry.
READ ALSO: Buhari approves Seplat's acquisition of Mobil Nigeria from ExxonMobilMr. Adesina's statement said: "The President, as part of his commitment to invest in light of the Petroleum Industry Act, has given his consent to the Share Sale Agreement, as requested by the parties to the transaction...
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