Seplat Energy Plc on Thursday confirmed the completion of its acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil, in a deal that was first made public in 2022.
The leading Nigerian energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, in a statement, described the transaction as ‘transformative’ for Seplat Energy.
Although the new value of the deal was not made public in the statement released by the indigenous energy firm, THISDAY had reported earlier that the deal which was previously valued at $1.28 billion, now has a final consideration of $800 million. No explanation was given for the difference.
In October, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) approved the sale of ExxonMobil’s onshore oil and gas assets in Nigeria to the local company Seplat Energy, more than two years after the deal was first signed in February 2022.
THISDAY further gathered that the final cash consideration payable to ExxonMobil at closing is now $672 million, with a $128 million deposit paid in 2022 at first SPA signing. The deal is fully funded from available cash and debt facilities, with no new equity issuance required.
With the transaction now completed, Seplat stated that it was set to more than double its production and position the company to drive growth and profitability, while contributing significantly to Nigeria’s future prosperity.
“The completion of this acquisition has created Nigeria’s leading independent energy company, with the enlarged company having equity in 11 blocks (onshore and shallow water Nigeria); 48 producing oil and gas fields; five gas processing facilities; and three export terminals.
“The acquisition of the entire issued share capital of MPNU adds the following assets to the Seplat Group: 40 per cent operated interest in OML 67, 68, 70 and 104 and 40 per cent operated interest in the Qua Iboe export terminal and the Yoho Floating Production Storage (FSO).
“Also, 51 per cent operated interest in the Bonny River Terminal (BRT) NGL recovery plant; 9.6 per cent participating interest in the Aneman-Kpono field; and approximately 1,000 staff and 500 contractors will transition to the Seplat Group,” it said.
Chairman of Seplat Energy, Senator Udoma Udo Udoma, in his comments, expressed his delight over the closing of the Sale and Purchase Agreement (SPA), pledging to deliver value to all the company’s stakeholders.
“Seplat Energy sincerely thanks His Excellency, President Bola Ahmed Tinubu, for supporting this transaction, and appreciates the support and diligence of the various ministries and regulators for all the work to reach a successful conclusion.
“We are delighted to welcome the MPNU employees to Seplat Energy. We are excited to begin our journey in a new region of the country, and we look forward to replicating the positive impacts we have achieved within our communities in our current areas of operations.
“Seplat’s mission is to deliver value to all our stakeholders, and we treasure the good relationships we have developed with the government, regulators, communities and our staff,” Udoma stated.
Also in his remarks, Chief Executive Officer of Seplat Energy, Roger Brown, assured that Seplat has acquired a company with one of the best portfolios of assets and related infrastructure in a world class basin.
“Today we have achieved a major milestone in the history of Seplat Energy and I extend my thanks to the entire Seplat team for their hard work and perseverance to complete this transaction.
“MPNU’s employees and contractors have a strong reputation for safety and operational excellence, and I welcome them to the Seplat Energy Group.
“We have acquired a company with one of the best portfolios of assets and related infrastructure in a world class basin, providing enormous potential for the Seplat Group. Our commitment is to invest to increase oil and gas production while reducing costs and emissions, maximising value for all our stakeholders.
“MPNU is a perfect fit with our strategy to build a sustainable business that can deliver affordable, accessible and reliable energy for Nigeria alongside attractive returns to our shareholders,” Brown stated.
Strategic priorities and near-term outlook, Seplat said the MPNU deal adds substantial reserves and production to the company, with 409 MMboe 2P reserves and 670 MMboe 2P + 2C reserves and resources as at June 30, 2024 and 6 million 2024 average daily production of 71.4 kboepd.
“As operator, Seplat’s immediate tasks are to ensure smooth transition of MPNU staff into Seplat, and on the operations, to swiftly target numerous opportunities that exist to organically grow production and further enhance the value of the assets for all stakeholders,” the energy company stated.
Besides, it said that the detailed guidance for the enlarged group in 2025 will be provided with Seplat’s full year 2024 results, expected in February 2025, noting that further announcements will be made as and when appropriate, in line with regulatory requirements.
Separately, at a press conference held on Thursday at the company’s headquarters in Lagos, the energy firm said that with the successful acquisition of MPNU, the new business has changed to Seplat Energy Producing Nigeria Unlimited (SEPNU).
It announced that the Executive Director and Development Manager at ExxonMobil Affiliates in Nigeria, Mr. Dotun Isiaka, has now been appointed as the Managing Director of SEPNU.
Among Seplat Group’s priorities in relation to the new acquisition, it said, is to ramp up production as the asset which boasts of 600 wells currently stagnates at 30 per cent production.
Director of Production, Mr. Ikay Ogunmwonyi, said the export terminal under the MPNU was designed for 600,000 barrels per day of oil but was underutilised.
In addition, he said the asset holds over 600 wells but that 70 per cent of those wells were not producing, leading to the 30 per cent stagnation.
He explained: “The terminal itself is designed for 600,000 barrels. That’s what that facility is designed for. And we are nowhere near that today. We have over 600 wells on that asset and 70 per cent of those wells are not producing.
“There’s a lot of work going on right now. And they’re not producing for various reasons. There’s a lot of work going on right now for us to determine exactly how much production will we get out of those wells. Because you have to do some work. You have to get vessels. You have to get boats.
“You have to get all of that put together. I’m trying to leave you with the fact that there’s so much knowledge capacity that we have to play with. So, I think it’s the beginning of a new day.
“It’s an exciting time not just for us in Seplat, but it’s also an exciting time for the country. So I’ll ask that you please watch that space.”
Emmanuel Addeh and Peter Uzoho
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