President Bola Tinubu announced that ministerial approval for the ExxonMobil and Seplat divestment transactions is expected in the coming days. He made this disclosure during his Independence broadcast on Tuesday, highlighting that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has already approved the divestment process in accordance with the Petroleum Industry Act (PIA).
Tinubu emphasized his administration’s commitment to fostering free enterprise, allowing for both entry and exit in investments, while ensuring the integrity of the nation’s regulatory processes. “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,” he stated. He noted that the transaction was handled similarly to other approved divestments in the sector.
The President highlighted that this move is expected to enhance the vibrancy of the oil and gas sector, ultimately benefiting the national economy. The divestment deal between Seplat and ExxonMobil has faced delays for over two years. In July 2022, the Nigerian National Petroleum Company (NNPC) blocked the asset sale, resulting in a court decision that temporarily halted the transaction.
Seplat had initially agreed to acquire ExxonMobil’s Nigerian subsidiary for at least $1.28 billion in February. The NNPC aimed to take over the permits and prevent the sale, leading to ongoing litigations. A settlement was finally reached earlier this year when the NNPC lifted the court injunction, allowing the asset sale to Seplat to move forward. It was advised that the NNPC consider selling its stake in the ExxonMobil asset instead of maintaining a joint venture with Seplat.
Oil and gas expert Prof. Wumi Iledare commented on Tinubu’s update, affirming that the impending ministerial approval for the $1.28 billion sale is a positive development. He noted that while some may oppose divestment, it is an essential aspect of the upstream business. He suggested that the NNPC sell its share in the ExxonMobil joint venture to the Dangote oil refinery to strengthen its stake in the refinery.
Iledare expressed that the President should have delegated the announcement to the regulatory commission, stating, “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.”
