In this article, the Nigerian National Petroleum Company (NNPC) said it would not hinder Divestments by Oil and Gas Multinationals.
The Nigerian National Petroleum Company (NNPC) limited says its role in the divestment of international oil companies (IOCs) from onshore and shallow water assets in the country is that of a facilitator.
NNPC has said it would not hinder but instead facilitate international oil and gas companies (IOCs) in executing divestments.
Mele Kyari, chief executive of the national oil and gas company, declared the position at the Nigerian International Energy Summit in Abuja, NNPC said in a news release.
“He explained that by virtue of its statutory mandate as the enabler of national energy security, NNPC Ltd.’s role is to ensure that, at the end of the day, there is optimal and sustainable production from the divested assets to guarantee energy security for the benefit of Nigerians”, the release stated.
Equinor ASA last year decided to exit the West African country, while Shell last month announced the divestment of its onshore subsidiary in Nigeria.
In November Norway’s majority-state-owned Equinor announced it was selling its stake in the Niger Delta’s Agbami oil field as it exits Nigeria. Equinor holds a 20.21 percent interest in Agbami, which is operated by Chevron Corp. with a 67.3 percent interest. Prime 127 Nigeria Ltd. holds the remaining 12.49 percent. The world’s biggest oil discovery in 1998, Agbami holds an estimated 900 million barrels of recoverable volumes according to information on Chevron’s website.
“This transaction realizes value and is in line with Equinor’s strategy to optimize its international oil and gas portfolio and focus on core areas”, Equinor said in a statement at the time.
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Meanwhile Shell in a statement January 2024 said the sale of Shell Petroleum Development Company of Nigeria Ltd. “marks an important milestone for Shell in Nigeria, aligning with our previously announced intent to exit onshore oil production in the Niger Delta, simplifying our portfolio and focusing future disciplined investment in Nigeria on our Deepwater and Integrated Gas positions”.
On September 4, 2023, Eni SPA announced an agreement divesting one of its units in Nigeria to Oando PLC, saying the move is part of efforts to refocus on more profitable assets. Nigerian Agip Oil Co. Ltd. is an onshore-focused oil and gas exploration and production subsidiary of the Italian energy major.
In 2022 Exxon Mobil Corp. announced an agreement to sell its equity stake in Mobil Producing Nigeria Unlimited to an independent local player. Mobil Producing Nigeria holds a 40 percent stake in four oil mining licenses including over 90 shallow-water and onshore platforms and 300 producing wells, according to ExxonMobil. ExxonMobil will maintain its deepwater assets in Nigeria.
None of the divestments have been completed.
Earlier in February the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) announced a partnership with S&P Global Inc. to make divestment assessments align with international best practices.
“NUPRC has already set out about six criteria for the divestment assessment, tailored towards comprehensive evaluation of environmental impact, social responsibility, governance practices, and financial performance, labor relations and legal framework amongst others”, said a press release by the regulator February 7.
Oil theft and illegal pipeline connections have posed operational risks to oil and gas players in the West African country. Kyari reported January NNPC had destroyed over 5,500 unauthorized refineries and nearly 4,500 illegal pipeline connections over the last three years.
Speaking at a university guest lecture in Ile-Ife, Osun, Mele Kyari highlighted pipeline vandalism and crude oil theft, as well as rapid population growth, as the main challenges to energy security in Nigeria, the NNPC said in a news report January 17.
Meanwhile Felix Omatsola Ogbe, executive secretary of the Nigerian Content Development and Monitoring Board, said in a statement February 5, “We want to make international oil companies comfortable and reverse the exit of foreign investors because they create jobs, and we need all hands on the deck”.
“We want to create the enabling environment that will minimize conflicts with international oil companies and attract investments into the sector”, Ogbe said affirming commitment to a deal with oil majors that aims to cut the duration of the awarding process for petroleum development projects to six months for existing production-sharing contracts