NUPRC Clarifies Divestment Activities and Addresses Atiku’s Concerns on Oando and Others

Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Clarifications on IOC Divestments:

Background: The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has clarified its role and processes in recent divestments involving several International Oil Companies (IOCs), including Oando, Mobil, Seplat, and Eni-AGIP. This move aims to maintain transparency and address public concerns.

Key Points of Clarification:

1. Process and Approval:
   • NUPRC has followed the Petroleum Industry Act (PIA) 2021 for these divestments, ensuring all regulatory steps and ministerial consents were adhered to.
   • The Commission engaged reputable external consultants to identify and address pre-sale liabilities associated with the assets being divested.
2. Specific Divestments:
   • NAOC-Oando Divestment:
     • NAOC (Nigeria Agip Oil Company) proposed divesting its assets to Oando Petroleum and Natural Gas Company Limited and Oando Oil II Cooperatief U.A.
     • The process involved technical evaluations and regulatory approvals, with final ministerial consent granted.
   • Equinor-Chappal Divestment:
     • Equinor Nigeria’s assets were divested to Chappal Energies, following the same regulatory process as the NAOC-Oando transaction.
   • MPNU-Seplat Divestment:
     • Mobil Producing Nigeria Unlimited (MPNU) proposed to assign its shares to Seplat Energy Offshore Limited.
     • This divestment faced delays due to disputes with NNPC (Nigerian National Petroleum Company), but the issue was resolved in June 2024. The process is ongoing within the 120-day timeline set by the PIA.
3. Transparency and Due Diligence:
   • NUPRC emphasizes its commitment to transparency and due diligence. The Commission’s due diligence process includes evaluating technical capacity, financial viability, legal compliance, and environmental factors.
   • For the NAOC divestment, the Commission conducted thorough evaluations and addressed all identified liabilities.
4. Public and Legal Scrutiny:
   • The NUPRC’s efforts are in response to public scrutiny and legal challenges. Former Vice President Atiku Abubakar had raised concerns about the accelerated nature of these deals, alleging undue influence due to President Tinubu’s connections.
5. Commitment to Best Practices:
   • NUPRC reassures the public that all processes are conducted in line with international best practices and the provisions of the PIA.
   • The Commission remains dedicated to maintaining legal, independent, and professional standards in its regulatory activities.

Summary: The NUPRC has outlined its rigorous process for approving divestments by IOCs, ensuring compliance with legal and regulatory standards. This transparency aims to address public concerns and reaffirm the Commission’s commitment to effective and accountable governance in the oil and gas sector.