On Monday, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) addressed recent concerns about two major oil industry transactions.
The commission clarified that the acquisition of Nigerian Agip Oil Company (NAOC) by Oando PLC and the ongoing divestment process involving Mobil Producing Nigeria Unlimited (MPNU) and Seplat Energy Offshore Limited are proceeding according to regulatory guidelines set by the Petroleum Industry Act (PIA).
The agency’s clarification comes in response to criticism from former Vice President Atiku Abubakar, who questioned the speed and process of the NAOC acquisition. Atiku expressed concerns over the accelerated approval of the $783 million deal.
NUPRC is responsible for overseeing and regulating upstream petroleum activities in Nigeria. This includes managing the processes involved in the sale and transfer of oil and gas assets.
The Petroleum Industry Act (PIA), which came into effect in 2021, sets out the legal framework for the oil and gas sector in Nigeria. It aims to improve transparency, efficiency, and governance within the industry.
According to NUPRC, the acquisition of NAOC by Oando PLC was conducted in line with the regulations of the PIA. NAOC, a major player in Nigeria’s oil sector, decided to sell its interests in some of its oil and gas assets.
The deal, valued at $783 million, was fast-tracked, which raised concerns about its approval process.
Mrs. Olaide Shonola, Head of Public Affairs at NUPRC, explained, “The approvals given to the NAOC-Oando and Equinor-Chappal divestments were in accordance with the Petroleum Industry Act (PIA) 2021, defined regulatory framework, and standard consent approval process set by the Commission under the PIA.”
Shonola detailed that NAOC had notified NUPRC of its intention to divest its interests on May 16, 2023.
The commission requested additional information on the proposed buyers, and after reviewing the technical evaluation of the shortlisted companies, NAOC submitted Oando as the qualified buyer.
On August 9, 2023, NUPRC granted approval for NAOC to proceed to the commercial stage of the transaction. On November 7, 2023, NAOC formally requested consent from the Minister of Petroleum Resources. The commission continued to monitor the process to ensure compliance with legal and regulatory requirements.
The NUPRC also addressed the ongoing divestment process involving Mobil Producing Nigeria Unlimited (MPNU) and Seplat Energy Offshore Limited. MPNU is in the process of selling its assets to Seplat, a transaction that is also being reviewed by the commission.
Shonola clarified, “The divestment by MPNU to Seplat Energy Offshore Limited is currently undergoing the same consent approval process and is expected to be completed within the 120-day timeline provided by the PIA.”
