NNPC cancels ExxonMobil’s $1.6bn assets’ sale to Seplat

04 Mar NNPC cancels ExxonMobil’s $1.6bn assets’ sale to Seplat

The Nigerian National Petroleum Company Ltd has opted to exercise its right of first refusal over  $1.6bn assets’ sale to Seplat  as contained in the Joint Operating Agreement (JOA) of the ExxonMobil/NNPC  Joint venture V + details of NNPC’s position on the planned sale of ExxonMobil shares to SEPLAT Energy Plc. This technically nullifies the deal between ExxonMobil and Seplat.

ExxonMobil and SEPLAT Energy recently announced a sales agreement for SEPLAT to purchase ExxonMobil’s complete shares in MPNU, subject to regulatory approval.

The NNPC has notified Mobil Producing Nigeria Unlimited of its intention to exercise a Right of Pre-emption on ExxonMobil’s planned sale of its entire asset in Nigeria’s onshore and shallow waters.

The right of pre-emption is a legal right to parties in a joint venture to be the first to be considered for any planned sale or takeover of assets in the JVs if either party chooses to trade them off.

In a letter signed by Group Managing Director, Mele Kyari and addressed to ExxonMobil, the NNPC reiterated its resolve to take over ExxonMobil’s share of the assets.

The NNPC would be required by terms of the joint venture JOA, to fully match the offer of the winning bid.

Seplat Energy, the company that made the winning bid, staked $1.583 billion for the deals to acquire the entire share capital of MPNU plus contingent consideration, noting that the asset transfer will wait for the minister’s assent.

The NNPC also reiterated in the letter that it had transformed from being a corporation to being a profit-driven company and that it now has the capacity to buy over the share of ExxonMobil in Joint ventures.