The Nigerian National Petroleum Company Limited (NNPC) has resolved the legal issues that have long stalled Seplat Energy Plc’s acquisition of ExxonMobil’s Nigerian assets.
The $1.28 billion deal, which involves the transfer of Mobil Producing Nigeria Unlimited (MPNU) shares to Seplat, has been the subject of thorough investigation and negotiations.
The NNPC, which had previously asserted its preferential rights under a Joint Operating Agreement, has now filed a motion to discontinue its lawsuit against Seplat, making it possible for the transaction to proceed.
This development follows a settlement agreement that aligns the interests of MPNU shareholders with NNPC’s objectives, ensuring a collaborative approach towards finalizing the deal.
The agreement, which includes the withdrawal of all interim orders and the substantive suit against MPNU and other defendants, stipulates the discontinuation of arbitration proceedings, ensuring a mutual desire to move beyond the dispute.
The transaction’s completion will have a good economic impact on Nigeria, allowing Seplat to take over ExxonMobil Nigeria’s offshore shallow water operations. This acquisition is expected to enhance Nigeria’s position in the global energy market and contribute to the country’s economic growth.
The resolution of this dispute comes after a series of legal challenges, including an “order of interim injunction” that had previously prohibited Exxon from finalizing any divestment. The federal government’s initial reluctance to approve the transaction, pointing to national interest, added to the complexity of the situation.
However, with NNPC’s motion to discontinue the lawsuit and the settlement agreement in place, Seplat can now finalize its acquisition. This could be the beginning of a new period for Nigeria’s oil sector, with increased domestic control over its resources and a potential boost to the nation’s economy.
Stakeholders await the court’s approval of the discontinuance.
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