‘Legal issues will be resolved’ — Seplat says Tinubu will approve MPNU acquisition

Seplat says associated legal issues with the acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil will be resolved.

The oil and gas company said this on Monday in its unaudited results for the nine months ended September 30, 2023.

Seplat initially announced the agreement to acquire MPNU from ExxonMobil in February 2022 – putting the completion of the transaction in the second half of last year. 

However, the acquisition was blocked by the Nigerian National Petroleum Company (NNPC) Limited and Nigerian Upstream Regulatory Commission (NUPRC) after Muhammadu Buhari, the then president, assented to the deal.

Buhari approved the acquisition in August last year but later withdrew his consent after NUPRC said it would not confirm the deal due to overriding national interests. 

NNPC, with a 60 percent stake in MPNU assets, expressed the right of first refusal and also obtained a court order to block the acquisition.

The acquisition is meant to cost Seplat $1.28 billion, with potential additional contingent consideration of up to $300 million in total, payable over the period January 1, 2022, to December 31, 2026. 

Seplat had deposited $128 million cash for the acquisition of MPNU from ExxonMobil. 

On May 24, 2023, Seplat extended the share sale and purchase agreement (SSPA) for the acquisition of ExxonMobil’s share capital of MPNU due to a delay in obtaining approval.

Updating its shareholders and the capital market on Monday, Seplat said there is increasing confidence that President Bola Tinubu’s administration will approve the deal. 

“The Board remains confident that the transaction will be approved, and all associated legal issues will be resolved,” Seplat said. 

“We continue to work with all parties to achieve a successful outcome, including our financiers who remain supportive, and have been encouraged by the recent drive of the Tinubu administration to promote investment in country. We will provide further updates as appropriate.” 

In February 2023, Roger Brown, Seplat’s chief executive officer, in the company’s financial statements for the full year 2022, said the company hoped to complete the deal before a new president was sworn into office in May.

Assets under the management of MPNU are four oil mining leases (OMLs) 67, 68, 70, 104, as well as an export facility, the Qua Iboe Terminal.