Chappal Energies completes acquisition of Equinor

Chappal Energies, a Nigerian-owned firm, says it has completed the acquisition of Equinor Nigeria Energy Company, a subsidiary of Norway-based Equinor ASA.

In November 2023, Equinor said it agreed to sell its Nigerian business, including the company’s stake in the Agbami oil field, to Chappal Energies.

On October 21, the federal government approved the divestment of Equinor Nigeria Energy Company Limited’s divestment to Project Odinmin Investments Limited.

According to Bloomberg on Saturday, the deal gives Mauritius-registered Chappal control of ENEC, which holds 53.85 percent ownership in the oil mining lease (OML) 128.

The publication said the deal includes a 20.2 percent stake in the Chevron-operated Agbami oil field, as well as the operatorship of OML 129.

The project was completed through Project Odinmim, a special-purpose vehicle owned by Chappal, at an undisclosed sum.

Speaking on the deal, Ufoma Immanuel, managing director of Chappal Energies, said the acquisition attracts immediate production and cashflow benefits.

“Rand Merchant Bank, a division of South Africa-based First Rand Bank Limited, acted as the sole financial adviser to Chappal Energies on the deal, one of several in Africa’s largest crude producing nation this year,” the statement reads.

“Oil majors, including Shell Plc, Eni and Exxon Mobil Corp. have divested or are in the processing of offloading assets in the West African nation — mostly in onshore and shallow water blocks — to domestic producers as they cut down their exposure to a challenging environment plagued by aging infrastructure and rampant oil theft.”

According to Gbenga Komolafe, the chief executive officer (CEO) of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Eni’s divestment of Nigerian Agip Oil Company (NAOC) to Oando Plc, TotalEnergies-Telema Energies deal, and ExxonMobil’s sale of Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy, received ministerial consent.

However, Shell Petroleum Development Company Limited’s assets to Renaissance Africa Energy Company Limited could not scale the regulatory test.