The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced that Oando PLC has completed the acquisition of 100% shares of Nigerian Agip Oil Company Limited (NAOC Ltd).
NUPRC Chief Executive, Engineer Gbenga Komolafe disclosed on Wednesday that Oando Plc a leading indigenous energy solutions provider has completed its divestment agreement with ENI for the acquisition of 100% of the shares of Nigerian Agip Oil Company Limited (NAOC Ltd).
He disclosed this at the ongoing Oil and Gas Energy Week in Abuja sponsored by the Nigerian National Petroleum Company (NNPC) Limited and others, attended by Nairametrics analyst.
The NUPRC Chief also announced the status of acquisitions involving three other major oil companies in Nigeria.
Acquisition status
According to him, the NAOC – Oando deal is completed and the signing ceremony is to be conducted in the coming days.
For the deal between Equinor and Project Odinmim, he said it has been completed as well while the signing ceremony is to be conducted in the coming days.
For the Shell Petroleum Development Company of Nigeria Limited (SPDC) deal with Renaissance Consortium, he said documents has been submitted by SPDC and it is “undergoing due diligence.”
For the Seplat proposed takeover of ExxonMobil Nigeria’s offshore shallow water operations, he disclosed that the “company(Seplat) expressed commitment to proceed to apply for Ministerial Consent to NUPRC.”
NUPRC is one of the regulatory agencies for oil and gas sector stakeholders.
Delay in divestment moves
Responding to the need to fast-track the conclusion of the ongoing divestments in Nigeria, Komolafe stressed that the NUPRC recognizes that divestment is within the rights and purview of investors in view of the principles of free entry and free exit.
But he said the job of a regulator such as NUPRC is to ensure that as a gatekeeper, divestment is done in line with the rule of law and best practices.
He explained that countries like Brazil, Canada, and the UK have had very bad experiences with divestments.
“Divestments in these various jurisdictions were done but the experiences of the countries were not good enough and for us as a country and regulatory, we do not want that to happen to our nation.
“While we recognize the rights of investors to divest, the regulator maintains that that is done within the rule of law and that exactly is what we are doing at NUPRC, ” He said.
He revealed the roadblocks that need to be crossed by investors to get the requisite approvals in Nigeria.
What he said,
“The security of national interest must be guaranteed and to that extent, we need the industry to understand that the regulator proactively put in place the divestment framework which guided the ongoing divestment and which we have institutionalized.
“The objective is that the seller will ensure that the buyer is able to demonstrate financial capacity, technical capability, and no legal encumbrances. Issues of decommissioning and abandonment will be well situated so that the nation does not end up carrying an unintended burden.
“The issue of host communities and environmental fund are well situated and of course, industrial and labour relations are well taken care of as well as data repatriation, ” he itemized.
More insights
Oando had announced the proposed acquisition of Agip from ENI, subject to Ministerial Consent and other required regulatory approvals.
Eni also confirmed signing an agreement with Oando PLC – Nigeria’s leading indigenous energy solutions provider listed on both the Nigerian and Johannesburg Stock Exchange – for the sale of Nigerian Agip Oil Company Ltd (NAOC Ltd), the wholly Eni-owned subsidiary focusing on onshore oil & gas exploration and production in Nigeria, as well as power generation.
ENI noted however that it will still maintain its presence in Nigeria through the Nigeria Agip Exploration (NAE) and Agip Energy.
It also said the transaction was in line with the company’s 2023-2026 plan.
Backstory
Nairametrics previously reported that the transaction would also increase Oando’s current participating interests in OMLs 60, 61, 62, and 63 from 20% to 40%
A few months back, Project Odinmin Investments Limited (the Acquirer or POIL) announced its proposed 100% acquisition of the issued shares of Equinor Nigeria Energy Company Limited (the Target) from the current shareholder of the Target being Equinor Nigeria AS (the Seller) (the Proposed Merger).
The SPDC also recently clarified in a Nigerian court that its over $1.3 billion onshore oil assets sale to Renaissance Consortium is a share transaction, adding that its Nigerian assets are intact.
The Nigerian National Petroleum Company Limited (NNPC) had filed a motion to discontinue its legal action against several subsidiaries of Mobil Nigeria and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The motion, filed on June 11, 2024, in the High Court of the Federal Capital Territory, Abuja, was part of a broader effort to finalize a settlement agreement for the divestment of a 100% interest in Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Offshore Limited.
NUPRC had established a divestment framework to oversee the evaluation of applications for ministerial consent regarding the Shell Petroleum Development Company of Nigeria Ltd (SPDC) divestment process and others.
The transactions between these companies had dragged on for a while in view of the compliance requirements in Nigeria they were meant to meet.