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President Muhammadu Buhari has finally given consent to the sale of Exxon Mobil shares in the United States of America to Seplat Energy Offshore Limited.
A statement on Wednesday by Special Adviser to the President, (Media and Publicity) Femi Adesina states, “In his capacity as Minister of Petroleum Resources, and in consonance with the country’s drive for Foreign Direct Investment in the energy sector, President Muhammadu Buhari has consented to the acquisition of Exxon Mobil shares in the United States of America by Seplat Energy Offshore Limited.
“Exxon Mobil had entered into a landmark 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, both registered in Delaware, USA.
“Considering the extensive benefits of the transaction to the Nigerian Energy sector and the larger economy, President Buhari has given Ministerial Consent to the deal.
“The President, in commitment to investment drive in light of the Petroleum Industry Act, granted consent to the Share Sales Agreement, as requested by the parties to the transaction, and directed that the approval be conveyed to all the parties involved.
“Exxon Mobil/Seplat are expected to carry out operatorship of all the oil mining licenses in the related shallow water assets towards production optimization to support Nigeria’s OPEC quota in the short term as well as ensure accelerated development and monetization of the gas resources in the assets for the Nigerian economy.
“President Buhari also directed that all environmental and abandonment liabilities be adequately mitigated by Exxon Mobil and Seplat.”
Pointblanknews.com reports that the deal which is worth $1.28 billion has been enmeshed in controversies bothering on bribery allegations.
Pointblanknews.com gathered that a $100 million bribe was shared among top officials to secure the Federal Government’s approval.
The $100 million, it was gathered, was allegedly given to bribe some top government officials with a view to compromising the process leading to the point where the purported approval was announced on Monday by President Muhammadu Buhari.
Apparently embarrassed by the bribery scandal rocking the government, Buhari was reported to have directed the Department of State Service (DSS) to investigate the matter.
In February 2022, Seplat Energy Plc. had announced an agreement to acquire the entire share capital of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation, Delaware for $1.28 billion.
The transaction entails the acquisition of ExxonMobil Nigeria’s entire offshore shallow water business.
According to the deal, ExxonMobil Nigeria’s shallow water business is an established, high-quality operation with a highly skilled local operating team and a track record of safe operations.
A pre-emptive right over the assets had been secured by the Nigerian National Petroleum Company Ltd while it has also in July won a court decision temporarily blocking Exxon Mobil Corporation from selling assets in Nigeria to Seplat Energy Plc.
But a federal high court judge in Abuja had granted NNPC an “order of interim injunction” on July 6, 2022, barring Exxon Mobil “from completing any divestment” in a unit that ultimately operates four licenses in Nigeria.
Despite the court’s verdict, President Buhari had gone ahesd to approve that the deal should be consummated by Mobil and Seplat.
The Presidency’s announcement of the approval of the deal came as shock to many industry players because the transaction had initially been declined on July 5 this year by the President who doubles as the Minister of Petroleum Resources and assisted by Chief Timpre Sylva as Minister of State.
Industry sources alleged that there had been underground moves by sponsors of the share purchase transaction to get approval for the deal, after it was declined by the government.
The sources also insisted that the approval by the Presidency was not in conformity with the provisions of the Petroleum Industry Act 2022 which gives the sole authority to the Nigeria Upstream Petroleum Regulatory Commission (NUPRC).
NUPRC had in a statement on August 8, 22 reaffirmed that its decline to the acquisition deal between Seplat Energy Plc. and Exxon Mobil Corporation has not been reversed.
It stated that the issue at stake is purely a regulatory matter, adding that the Commission had earlier communicated the decline of Ministerial assent to ExxonMobil in this regard.
The statement said following the decline of ministerial approval, the status quo must remain.
“The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) affirms that status quo remains in respect of ExxonMobil/Seplat Energy share acquisition.
“The Chief Executive of the NUPRC Engr. Gbenga Komolafe clarified that the Commission in line with the provisions of the Petroleum Industry Act 2021 is the sole regulator in dealing with such matters in the Nigerian upstream sector.
“As it were, the issue at stake is purely a regulatory matter and the Commission had earlier communicated the decline of Ministerial assent to ExxonMobil in this regard. As such the Commission further affirms that the status quo remains.
“The Commission is committed to ensuring predictable and conducive regulatory environment at all times in the Nigerian upstream sector,’’ said the statement.
Industry watchers and experts have hailed the decision of NUPRC to stand up to its regulatory function as contained in the PIA.
They lauded NUPRC’s standoff and resistance to political pressure to endorse illegality, pointing out with the defense of its constitutional mandate, Nigeria is now ready to conduct businesses in the oil and gas sector in a transparent manner and in line with international best practices as stipulated in the PIA.