Despite the applaud received from stakeholders and the general public by both government and the parties concerned, the Seplat -ExxonMobil deal, has the potential to transform Nigeria’s oil and gas industry, just as it also has a herculean task ahead to become a successful venture.
Its success will depend on various factors, including regulatory stability and security.
One of the major issues Seplat, the new owner of the assets will have to contend with is the issue of the Regulatory Framework
The deal’s success will depend on Nigeria’s regulatory framework, which has been criticized for being unclear and inconsistent.
Another issue is security concerns. The oil and gas sector in Nigeria faces security challenges, particularly in the Niger Delta region.
However, the economic benefits outweigh the challenges the venture would face
Some of the economic benefits include Increased Investment. The deal is expected to attract more foreign investment into Nigeria’s oil and gas sector, which has been struggling in recent years
Another thing is that it will improve efficiency as the acquisition is likely to lead to more efficient operations, as Seplat is known for its expertise in optimizing production from mature fields.
The deal will certainly create more job opportunities in the oil and gas sector, both directly and indirectly.
“When stakeholders talk of impact, the local content will certainly be impacted tremendously. The deal supports Nigeria’s local content policy, which aims to increase the participation of Nigerian companies in the oil and gas industry,” an industry operator said.
The acquisition may lead to diversification of Nigeria’s oil and gas sector, as Seplat is expected to explore new opportunities in the industry.
The Federal Government on Monday officially approved Seplat Energy’s purchase of Exxon Mobil’s onshore assets valued at $1.28bn.
The approval was confirmed by Gbenga Komolafe, the chief executive officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), on Monday.
Komolafe while speaking at the NUPRC’s 3rd Anniversary event in Abuja said that the ministerial approval had now been secured.
The approval comes more than two years after the deal was announced in February 2022, signaling a prolonged regulatory delay.
President Bola Tinubu had indicated on October 1 that the final approval would be granted within days, following clearance from the regulatory body.
The approval will result in Seplat Energy acquiring a 40 percent stake in four oil mining leases.
The company will also acquire key infrastructure, including the Qua Iboe export terminal and a 51 percent stake in the Bonny River natural gas liquids recovery plant, both previously owned by Exxon’s local subsidiary, Mobil Producing Nigeria Unlimited.
