Seplat to complete acquisition of MPNU from ExxonMobil tomorrow

Seplat Energy Plc says its acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil will be completed on December 12, with a final consideration of $800 million.

On October 21, Gbenga Komolafe, the chief executive officer (CEO) of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), announced approval of the deal by the federal government.

In a statement, Seplat Energy announced the publishing of the prospectus in relation to the acquisition.

The energy firm said the publication followed receipt of approval from the financial conduct authority (FCA) in the United Kingdom (UK).

“The transaction, which is expected to complete on 12 December 2024 is transformative for Seplat Energy, more than doubling production to around 120,000 barrels of oil equivalent per day and providing the Company with a significant opportunity to further drive its growth and profitability, whilst contributing significantly to the Nigerian economy,” the statement reads.

“These assets are of proven quality, located in one of the world’s leading hydrocarbon basins.”

According to the statement, Seplat Energy’s $800 million MPNU acquisition includes $672 million final cash consideration payable to ExxonMobil at closing, and $128 million deposit paid in 2022 at first sale and purchase agreement (SPA) signing.

The energy firm said the payment also comprises deferred payment of $257.5 million due by December 2025 to cover decommissioning and joint venture (JV) costs, “with no new equity issuance required”.

Seplat said the deal is fully funded from available cash and debt facilities, and no new equity issuance required.

The company said the transaction would increase Seplat’s pro forma 2P reserves by 86 percent to 887 million barrels of oil equivalent (MMboe).

Pro forma 2P oil and gas refers to the sum of a company’s proven and probable oil reserves.

Seplat said the transaction would also boost production by 148 percent to 119,800 million barrels of oil equivalent per day (boepd); increase revenue by 245 percent to $1.456 billion; and grow adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) by 199 percent to $800 million.

“The enlarged company has equity in 11 blocks in onshore and shallow water Nigeria, 48 producing oil & gas fields, 5 gas processing facilities, and 3 export terminals,” Seplat said.

“The company has license portfolio with multiple high-potential investment opportunities to drive growth

“It has short term oil gain (STOG) activities focused on well stock and facilities and multiple in-fill and exploration drilling locations.”