Oil sector investment sale transactions worth USD 1.5 billion completed – FG

The federal government on Wednesday announced the completion of the sale of shares in Nigeria Agip Oil Company and Oando Plc, as well as Equinor and Project Odinmim, worth a total of about $1.5 billion.

It was also reported that the number of operational drilling rigs in the country had increased to 34 as of June 2024, adding that a total of 31 oil blocks are currently up for tender in the 2024 licensing round through the Nigerian Petroleum Regulatory Commission, an agency of the federal government.

NUPRC Chief Executive Officer, Gbenga Komolafe, who disclosed this while speaking at the Nigeria Oil and Gas Conference in Abuja, also gave updates on the $2.4 billion share sale agreement in Shell Petroleum Development Company and Renaissance, as well as the $1.2 billion deal in ExxonMobil and Seplat.

Commenting on the four major asset sell-offs by international oil companies in Nigeria, Komolafe said: “Some of you who were present on the panel on Tuesday said that the chairman of the IPPG (Independent Petroleum Producers Group) raised the issue of the need for us to provide an update on the ongoing asset sell-off programmes.

“Now I am here to update you on the four major sales in Nigeria. The NAOC-Oando sale has been completed. The signing ceremony is expected to take place in the coming days.

“The Equinor-Project Odinmim sale has also been completed. In addition, the contract signing ceremony is expected to take place in the coming days. Regarding the SPDC-Renaissance contract, the documents have been submitted by SPDC. The documents are undergoing due diligence as we speak.”

The NUPRC chief told delegates at the conference that in relation to the ExxonMobil-Seplat deal, the parties concerned “have expressed a commitment to seek ministerial approval for the NUPRC”, adding that “at this point we have not yet received it”.

In September 2023, The PUNCH reported that energy company Oando Plc had entered into an agreement with Italian company Eni to acquire 100% of the shares in its oil and gas unit, Nigerian Agip Oil Company Limited.

Although neither the buyer nor the seller disclosed the value of the transaction, analysts suggested it was worth more than $500 million.

Oando Plc company secretary Ayotola Jagun, in a statement at the time, said the completion of the transaction was subject to ministerial approval and other required regulatory approvals.

With this transaction, Oando increases its current stake in OML 60, 61, 62 and 63 from 20 to 40 percent.

Also in November 2023, it was reported that Norwegian energy company Equinor had hired Standard Chartered to help it sell a majority stake in an offshore oil field in Nigeria.

According to Reuters sources at the time, the potential sale of Equinor’s 20 percent stake in the Agbami field off the coast of Nigeria could fetch up to $1 billion.

Equinor and Chappal Energies have entered into an agreement to sell Equinor Nigeria Energy Company, which owns a 53.85% interest in the OML 128 oil and gas concession, including a 20.21% interest in the Agbami oil field operated by Chevron.

Equinor has been present in Nigeria since 1992 and has played a significant role in the development of Nigeria’s largest deepwater field, Agbami. Since production began in 2008, Agbami has produced over one billion barrels of oil, creating value for partners and the Nigerian community.

Platforms reached 34

Meanwhile, Komolafe informed delegates at the conference that the number of drilling rigs in Nigeria will increase to 34 by June 2024.

“Our platform count has been gradually growing and that is something to celebrate. If we compare 2019-2022, at one point the platform count dropped to around 10, but today the situation has improved significantly.

“Compared to 2022, when we saw a decrease in the number of drilling rigs to about 10, I would like to announce that in June 2024, there were about 34 drilling rigs in the industry, which is a significant increase.

“And we as a regulator are going to continue with our regulatory processes to maintain this momentum and increase crude oil production,” Komolafe said.

Speaking about the number of oil blocks offered to investors in the 2024 licensing round, he said, “NUPRC has currently put up for sale a total of 31 blocks as I speak and the process has commenced on 29th April 2024 and for our information, the registration process will be completed in about 48 hours, which is exactly at midnight on Friday 5th July 2024.

“So if there are still potential investors who want to participate in this exercise, as we have done in the various roadshows that we have conducted, we encourage you as potential and wise investors to take advantage of the remaining 48 hours to participate.”