The conclusion of the $1.28 billion divestment deal between ExxonMobil and Seplat, along with similar transactions in Nigeria’s upstream oil sector, is expected to boost oil output by 21.4%, reaching over 1.7 million barrels per day, according to experts.
In his Independence Day national broadcast, President Bola Tinubu announced that the government is set to sign the ExxonMobil-Seplat deal in the coming days.
This agreement is expected to play a significant role in enhancing Nigeria’s oil production capacity and attracting further investments in the energy sector, according to Vanguard.
Some experts estimate that the addition of between 300,000 and 400,000bpd of condensate, along with increased output from ExxonMobil and Agip—already acquired by Oando—could elevate Nigeria’s total oil production to approximately 1.7 million bpd.
The National President of Oil and Gas Service Providers Association of Nigeria, OGSPAN, Mazi Colman Obasi, said “The ExxonMobil/Seplat deal has been on the drawing board for a while. It is therefore a good development to conclude it as soon as possible, especially it would very likely lead to increased oil and gas production.”
Another expert, who requested to remain anonymous indicated that “This would enable Nigeria to hit its future budget targets. The nation had based the 2024 budget at 1.7 million bpd, including Condensate and $77 per barrel. But it has been struggling to meet the target throughout the first half of the year.”
Recall this transaction Seplat Energy acquiring the entire share capital of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil for $1.28 billion. However, it has faced legal disputes that have complicated the deal. These challenges underscore the complexities often encountered in significant mergers and acquisitions within the oil sector, as stakeholders navigate regulatory and legal hurdles.
The Nigerian National Petroleum Company Limited had in June filed a motion to discontinue its legal action against several subsidiaries of Mobil Nigeria and the Nigerian Upstream Petroleum Regulatory Commission.
The motion filed on June 11, 2024, in the High Court of the Federal Capital Territory, Abuja, aims to facilitate the settlement agreement for the complete divestment of MPNU to Seplat Energy Offshore Limited.
This step is part of a larger effort to finalize the transaction, indicating progress in the divestment process and the interests of both parties involved.
Seplat Energy Plc announced its intention to acquire all shares of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation for $1.28 billion in February 2022.
