Journalism of Courage

Aftermath of media reports, Buhari denounces Femi Adesina’s purported approval to Seplat’s acquisition of ExxonMobil assets

…throws weight behind NUPRC’s position on status quo ante over Seplat-Mobil’s $1.28bn deal

A piqued President Muhammadu Buhari has broken his silence over the purported approval he gave for the Seplat Energy’s acquisition of ExxonMobil’s assets, denouncing the alleged presidential approval.

The reversal came barely two days after a statement issued by the President’s media adviser, Mr Femi Adesina, to the effect that the deal had been approved by the President.

Persecondnews recalls that Seplat had in February 2022 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.

Already, the Nigerian National Petroleum Company Limited (NNPC Ltd) had a pre-emptive right over the asset and in July it won an Abuja High Court judgment to temporarily block Exxon Mobil Corporation from selling assets in Nigeria to Seplat Energy Plc.

On July 6, 2022, a 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.

In spite of the court’s verdict, Buhari had  on Monday, July 8 approved that the “deal be consummated’’ by Mobil and Seplat.

Many industry players and watchers had expressed dismay and outrage about the so-called Presidential announcement on the approval as the transaction had initially been declined on July 5 byBuhari, who doubles as the Minister of Petroleum Resources.

To counter Femi Adesina’s  statement about the purported approval, the President ‘s spokesman, Malam Garba Shehu, confirmed that Buhari has backed the position of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) that the status quo ante should be maintained.

According to Shehu, the earlier confusion is because “various agencies involved in (the) decision had not coordinated well among themselves.”

He said: “It has become clear that the various agencies involved in the decision had not coordinated well among themselves and having looked at all of the facts with all of the ramifications, the president decided the position of the regulator is to be supported.”

The Presidency had said on Monday that there are extant laws governing such transactions, arguing that this statutory mandate lies within the purview of NUPRC.

On July 5, 2022, a source at the Presidency said a directive to the NNPC Limited to proceed with the acquisition of 40 per cent interest of ExxonMobil had been given.

He said Buhari’s approval still subsists, stressing that the President cannot suddenly reverse himself for a transaction of such magnitude.

“This must have been an unauthorised statement as there are extant laws governing such transactions and this statutory lies within the purview of the Nigeria Upstream Petroleum Regulatory Commission.

“For the avoidance of doubt, Mr. President’s directive to NNPC Limited to acquire 40 per cent interest of ExxonMobil still subsists and this was further reinforced by Mr. President on Friday, 5th July 2022.”

Based on the provisions of the Petroleum Industry Act 2021, any announcement about an industry transaction can only be made by the regulator – NUPRC.

“This (purported statement) is at variance with the PIA. The Nigeria Upstream Petroleum Regulatory Commission should be the one to announce. As such the General public is advised to disregard the purported statement.”

A high-ranking federal government official said following a request by the NNPC Ltd, the President had approved that NNPC should proceed with the pursuit of its rights under the Joint Operating Agreement of the NNPC/MPNU Joint Venture through the legal processes available to NNPC Ltd.

“Mr. President as Minister of Petroleum Resources sustains his earlier approval for the decline of the share transfer request by Mobil Producing Nigeria Unlimited. It will be doubtful if something else was announced after the approval.”

The CEO of NUPRC, Engr. Gbenga Komolafe had in a statement asserted the mandate of the Commission in line with the provisions of the Petroleum Industry Act 2021, the sole regulator in dealing with such matters in the Nigerian upstream sector.

Persecondnews also recalls that Komolafe had stated that 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.’’

In line with the decline of Ministerial assent, he said the Commission had directed that 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 oil and gas industry,’’ he said.

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