By Omotayo Edubi
Nigerian company, Seplat Energy Plc, has been listed on the Nigerian Exchange and the London Stock Exchange which was announced yesterday, Thursday, after it entered into an agreement to acquire the entire share capital of Mobil Producing Nigeria Unlimited (“MPNU”) from Exxon Mobil.
The company noted that the completion of the transaction was still subject to Ministerial Consent and other required regulatory approvals.
As the terms and conditions said, Seplat Energy Offshore Limited, a wholly owned Nigerian subsidiary of Seplat Energy Plc, has entered into a Sale and Purchase Agreement to acquire the entire share capital of MPNU for a purchase price of $1,283 million plus up to $300 million contingent consideration, subject to lockbox, working capital and other adjustments at closing relative to the effective date.
The Transaction encompasses the acquisition of the entire offshore shallow water business of ExxonMobil in Nigeria, which is an established, high-quality operation with a highly skilled local operating team and a track record of safe operations, producing 95 kboepd (W.I.) in 2020 (92% liquids).
Mr Roger Brown, managing director of the company who spoke to journalist via a zoom briefing said the transaction will make way for one of the biggest independent energy companies on both the Nigerian and London Stock Exchanges, and bolster Seplat Energy’s ability to drive increased growth, profitability and overall stakeholder prosperity.
Based on 2020 pro forma working interest volumes for Seplat Energy and MPNU, the transaction delivers 186 percent increase in production from 51 kboepd to 146 kboepd o 170 percent increase in 2P liquids reserves, from 241 MMbbl to 650 MMbbl 14 percent increase in 2P gas reserves from 1,501 Bscf to 1,712 Bscf, plus significant undeveloped gas potential of 2,910 Bscf (JV: 7,275 Bscf).
The deal will also create 89 percent increase in total 2P reserves from 499 MMboe to 945 MMboe, Includes offshore fields with dedicated, MPNU-operated export routes offering enhanced security and reliability.
Related Posts
The company said the transaction supports Nigeria’s energy transition and objectives of the Petroleum Industry Act as it is the first transaction to be announced since the Federal Government’s ratified Petroleum Industry Act (“PIA”), and supports its key objectives.
Brown said Seplat Energy is fully committed to working with the Nigerian Government to bring these strategically important national assets fully into Nigerian ownership alongside NNPC.
Also, development of MPNU’s gas resources will support the Federal Government’s objective to achieve a pragmatic, progressive and just energy transition for Nigeria.
Commenting on the acquisition, Dr. Bryant (ABC) Orjiako, Chairman of Seplat Energy, said: “This is a transformational acquisition for Seplat Energy that strengthens our partnership with the national oil company, the NNPC, and consummates the spirit of the newly enacted PIA.
“As a significantly larger business, with a stronger resource base and greatly enhanced capabilities, we will be better positioned to provide sustainable energy solutions that drive growth and profitability for the benefit of all our stakeholders, particularly our host communities and the wider Nigerian economy.
“We fully support the aims of the Federal Government’s “Decade of Gas”, and this acquisition will accelerate our development of Nigeria’s gas resources to help achieve a just transition for our rapidly growing country.”
Also reacting, Mr Roger Brown, CEO of Seplat Energy, said: “This transaction underpins Seplat Energy’s drive to be a leader in the growth of the indigenous independent energy sector in Nigeria.
“The acquisition is a perfect fit with our strategy to build a sustainable business and deliver energy transition in Nigeria. Our financial strength has enabled us to attract high quality local and international capital providers to fund this transaction without diluting our existing shareholders and reflects our deliberate approach to capital allocation.
“We are determined to drive our growth through the extensive low-cost and low-risk production opportunities it delivers in the near term, whilst also developing longer-term opportunities to monetise our significant gas resources through domestic and export opportunities.This is a win-win for both companies. Together, we will strengthen our focus on profitability and cash generation to reinvest in Nigeria’s energy development.”
