LAGOS, Nigeria (VOICE OF NAIJA)- President Bola Tinubu announced that the divestment transactions involving ExxonMobil and Seplat will receive ministerial approval within a few days.
Speaking during his Independence Day broadcast on Tuesday, Tinubu stated that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) had already approved the divestment process in accordance with the Petroleum Industry Act.
He further noted that the process followed the same guidelines as other qualified divestments previously approved in the sector.
Tinubu emphasized his administration’s commitment to free enterprise, allowing for open investment entry and exit, while upholding the integrity and effectiveness of the country’s regulatory frameworks.
He stated that this principle governs divestment transactions in the upstream petroleum sector, reaffirming his commitment to transforming the sector’s fortunes for the better.
“As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.
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“The move will create vibrancy and increase oil and gas production, positively impacting our economy,” the President noted.
The divestment agreement between Seplat and ExxonMobil has been on hold for more than two years.
On July 12, 2022, it was reported that the Nigerian National Petroleum Company Limited (NNPC) had intervened to prevent ExxonMobil from selling its assets to Seplat.
According to the report, NNPC secured a court ruling that temporarily halted ExxonMobil Corporation’s asset sale to Seplat Energy Plc in Nigeria.
In February, Seplat had agreed to purchase the U.S. oil giant’s subsidiary for a minimum of $1.28 billion.
The NNPC aimed to block the transaction and assume control of the permits, resulting in legal disputes.
However, a settlement agreement was reached this year, allowing the NNPC to lift a court injunction and enable the completion of the asset sale to Seplat.
Additionally, the NNPC received advice to sell its stake in the ExxonMobil asset rather than remain in a joint venture with Seplat Energy.
In response to President Tinubu’s update that the $1.28 billion ExxonMobil asset sale to Seplat would soon receive ministerial approval, oil and gas expert Prof. Wumi Iledare offered his insights.
Iledare noted that while some individuals may oppose the idea of divestment, it is a fundamental aspect of the upstream business.
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He stated that the acquisition of the ExxonMobil asset by a publicly traded company in Nigeria is a positive development.
Iledare recommended that the NNPC sell its stake in the ExxonMobil joint venture to Dangote Oil Refinery to increase its investment in the refinery.
Additionally, he expressed the view that the President should not have intervened in the matter.
“He should have just given the commission the power to announce such a thing. The moment he’s announcing it himself, it becomes a political game. However, I think it’s a good thing if they can conclude it. I wish NNPC will also sell their own share that is with that asset instead of going into a joint venture with Seplat,” he stated.