By Stephen Ubanna
Rogers Thomson Brown, Chief Executive Officer, CEO, and Executive Director, Seplat Energy Limited, an indigenous oil company, is a happy man. Brown source of happiness is that its planned takeover of the entire share of Exxon Mobil which had been foot-dragging on since February, 2022, has finally materialized.
The Company was said to have struck a $1.283 billion deal with the North American country of the United States oil company last February to take over its entire hare capital in Mobil Producing Nigeria Unlimited, MPNU,, which had concluded plans to discontinue their stakes in offshore operations in Nigeria and plough their investment elsewhere.
Energy analysts had seen the move by the US, oil company to discontinue its offshore operations in as tacit moves by the US, oil Company to quit Nigeria. The deal between the two oil companies could not be actualize because the Nigerian National Petroleum Corporation, NNPC, now baptized Nigerian Petroleum Company Limited, NNPC, with the signing of the Petroleum Industry Bill, PIB, into Law in 2021, by President Muhammau Buhari.
Mele Kolo Kyari, Managing Director of the NNPC, and is management team may not have found Seplat Energy Limited, moves to acquire the entire share capital of Exxon Mobil for $1.283 billion in MPNU in February 2021, funny.
This is because the Nigerian oil giant had wanted to exercise the ‘’right of pre-exemption the Exxon Mobil Pplanned Sale of its entire share capital in MPNU. This may have encouraged encouraged the Nigerian oil giant to head to a Federal High Court in Abuja , the Federal Capital Territory, FCT, to stop Seplat Enegy Limited from clinching the mouth watery deal.
The Abuja, Federal High Court in its ruling on July 6, 2022, had restrainede Exxon Mobil , from the sale and purchase of its entire share capital in MPNU by Seplat in February 2022. Edith Onwuchekwa, Seplat Energy Limited , Company Secretary had reportedly said that the Court granted an interim injunction restraining ExxonMobil , from completing any divestment ‘’in oil mining lease 68, oil mining lease 69 and oil mining lease 70 and its oil prospecting license. She further reported that the Court restrained MPNU and Mobil Development Nigeria plc from disposing of its shares in the joint operating agreement with NNPC.
Many believe that if the deal entered between ExxonMobil and Seplat Energy, in February, 2022, had been consummated by the two parties, it would have pushed up Seplat Energy daily oil production level to 95,000 barrels from assets in a joint venture ExxonMobil runs with NNPC.
The Nigerian President may have read the handwriting the wall that the struggle between between Seplat Energy Limited, and NNPC, for take over of the entire share capital of ExonMobil in MPNU, will affect the country daily oily production that he was forced to intervene to save the situation from degenerating. His Economic Advisers may have have advised him to step into the matter to separate fight betwe the Seplat Energy and the NNPC.
This may have have have informed why he intervened and putting all factors into consideration gave his consent to Seplat Energy Limited acquisition of ExxonMobil entire share capital in MPNU, and turned his back on on NNPC ,which was optimistic of getting the Presidential backing.
Femi Adesina , Special Adviser to the President on Media and Publicity may have broken the cherry news to industry stake holders and the two parties in the oil deal on Monday , August 7, 2022. In giving the approval for Seplat to take over the entire share capital of ExonMobil in MPNU, Adsina ,the Media Aide to the President in a Statement had said that he did so in his capacity as ‘’the minister of Petroleum Resources and in consonance with the country’s drive for Foreign Direct Investment, FID, in the energy sector’’.
Note that Exxon Mobil had entered into a landmark Sales and Purchase Agreement with Seplat Energy Limited which was said to have agreed to acquire its entire share capital in MPNU, Mobil Development Nigeria Inc, and Mobil Corporation Nigeria Inc, incorporated in Delaware , US.
Giving an insider information on why the Nigerian President consented to the acquisition of ExxonMobil entire share capital in MPNU, Adesina, had said that the Nigerian President took into consideration ‘’the extensive benefits of the transaction to the nation’s energy sector and the economy before doing so’’. He noted that ‘’the President commitment to investment drive of the nation’s Petroleum Industry Act, had informed why he granted consent to the share capital Sales Agreement , as requested by the two parties involved in the $1.283 billion deal.
Going by the Presidential approval , which was said to have been conveyed to the management of ExxonMobil/Seplat, the two companies are expected ‘’to carry out Operatorship of all the oil mining Licenses in related shallow water assets, towards ‘’production optimization to support Nigeria’s Organisation of Petroleum Exporting Countries, OPEC, quota in the short term as well as ensure accelerated development and monetization of the nation’s gas resources in the assets for the Nigeria economy’’.
The President who may not have wanted the issue of environmental pollution which had been a major problem between MPNU and the host communities in the past to crop up with the change in ownership of Exxon Mobil, was aid to have mandated the two parties, involved in the Sales and Purchase Agreement ‘’to ensure that all issues relating to environmental and abandonment liabilities were adequately mitigated’’.
Recall that in 2021, a Federal High Court I the FCT, Had awarded N42.8 billion as damages of intangible losses, N21.9 billion for Special damages as annotated and N10 billion as general damages, thus bring the cumulative damages against MPNU, and its Joint Venture partner, JVC, NNPC, N74.7 bilion, which must be paid in two weeks to the Ibeno oil Communities in Akwa Ibom state. This Is in addition to 8% interest that would accrue to the Communities principal sum yearly.
The trial Judge, Justice Taiwo Taiwo, had ruled in the case brought against ExxonMobil by one Effiong Archianga and nine others from Ibeno Council that the US oil Producing giant were ‘’negligent over the way and manner in which they handled oil spills that was said to caused severe environmental degradation in the communities’’.
The Judge was said to have cited ‘’ section 11, subsection 5 of the Oil Pipelines Act which makes it mandatory for oil companies to monitor and fix their pipelines at all times to avoid spillages and environmental degradation’’. Perhaps, ExxonMobil may have wanted to save itself from the pressure from the the Ibeno Oil bearing Communities that it finally took the decision to divest its investment in Nigeria.
In a related development, the Nigerian’s Upstram Petroleum Regulator appears to be backing NNPC, to takeover the Exxon Mobil entire share capital i MPNU, that it has contradicted the President’s consent giving the acquisition os Exxon Mobil to Seplat Energy. The NigerianUpstream Regulator was said to have said on Monday, August 7, 2022, that ”the matter was a Regulatory one and do not require Presidential intervention to resolve the crisis, , noting that nothing had changed after”it had earlier notified ExxonMobil that the transaction had been declined”.
Gbenga Komolafe, Nigerian Upstream Regulatory Commission”, was said o have told industry stakeholders that ”the status quo remains in respect of ExxonMobil /Seplat Energy share acquisition”. He had said that the Commission had communicated the decline of the transaction between the two parties to the President, insisting that the status quo remains in respect of Exxon Mobil/Seplat Energy share capital acquisition. Nigerians are watching to see how the controvery will en
