The Nigerian regulatory agency has approved the sales plans of ENI and Norway's national oil company. Previously, the transaction between the two companies was postponed for several months due to oil giants continuously withdrawing their onshore operations in this West African country, facing issues.
According to the WiseMoney APP, the Nigerian regulatory agency has approved the sales plans of ENI (E.US) and Norway's national oil company (EQNR.US). Previously, the transaction between the two companies was postponed for several months due to oil giants continuously withdrawing their onshore operations in this West African country, facing issues.
At an industry event held in Abuja on Wednesday, Oando and Project Odinmim Investments Ltd. respectively announced the acquisition of Nigerian Agip Oil Company Ltd. (NAOC) under ENI and Norway's national oil company's local business. The price was not disclosed.
Gbenga Komolafe, head of Nigeria's upstream regulatory agency, said that both transactions have been blocked due to due diligence, to "reduce the risk of divestment escaping legacy obligations and transferring them to new investors." He said that the signing of these agreements will take place in the "coming days."
It is understood that ENI announced an agreement on September 4 last year to sell a department that owns a 20% operating stake in four onshore oil and gas blocks. The transaction does not include the 5% stake held by NAOC in Shell Petroleum Development Company. ENI will continue to hold Nigeria LNG Ltd. and other assets.
In November last year, Norway's national oil company announced that it had reached an agreement to sell its local business to the little-known Chappal Energy Mauritius Ltd. This deal was completed through Project Odinmim, a special purpose entity owned by a Mauritian company.
Equinor Nigeria Energy holds a 53.85% share of OML 128 oil and gas leases and a 20.21% share of the Agbami oil field operated by Chevron (CVX.US).
Komolafe said that Shell and Exxon Mobil's other two divestment transactions are in different final stages. Shell has submitted a file to sell its Nigerian subsidiary to the local company consortium Renaissance for a proposed price of $1.3 billion, while Exxon Mobil has chosen to obtain government approval in a deal with Seplat Energy Plc.
For more than a decade, Nigerian oil giants have been selling onshore and shallow water blocks to domestic producers. These blocks are located in a challenging operating environment, where crude oil theft is a frequent cause of infrastructure damage.
As international companies focus on deepwater projects in this largest oil-producing country in Africa, this trend is accelerating.