- Chappal Energies has completed the acquisition of Equinor in a $1.2 billion deal
- The deal includes a 53.85 per cent stake in OML 128 oil and gas lease and a 20.2 per cent interest in the Chevron-operated Agbami oil field
- The acquisition was completed one year after the sale was first announced
Chappal Energies has acquired Equinor Nigeria Energy Company (ENEC), a subsidiary of Norway’s Equinor ASA, in an estimated $1.2 billion deal.
The $1.2 billion deal comprises a $710 million purchase price and contingent payments.
With the acquisition, Chappal Energies now controls ENEC, which holds a 53.85 per cent stake in the oil mining lease (OML) 128 oil and gas lease. This includes a 20.2 per cent interest in the Agbami oil field operated by Chevron and the operatorship of OML 129.
Equinor announced the transfer of all its assets to Chappal Energies, assuring that local employees will remain with the new company.
It said, “As part of the transaction, all of Equinor’s assets in Nigeria have been transferred to Chappal Energies. Local employees will remain with the newly transferred company under its new ownership, marking a complete exit of Equinor from Nigeria.”
Managing Director of Chappal Energies, Ufoma Immanuel, said the completion of the acquisition marks a milestone and aligns with the company’s objectives of maximising Nigeria’s gas resources for economic development.
Immanuel said, “This is a milestone achievement for us as an indigenous company acquiring a stake in an offshore production sharing contract (PSC) through a competitive process.
“This acquisition aligns with our objectives of securing existing production alongside development opportunities.
“We are committed to advancing the Nigerian government’s energy initiatives, particularly the Decade of Gas agenda, which aims to maximise the value of the country’s gas resources for economic transformation.”
History of divestment deal
On November 29, 2023, Equinor Nigeria confirmed the sale of its 54 per cent stake in OML 128 oil and gas lease to Chappal Energies after 32 years of operation in Nigeria.
After months of regulatory delay, the deal was officially approved in November 2024 and finalised on December 6.
The deal was executed through Project Odinmim, a special-purpose vehicle owned by Chappal Energies, while Rand Merchant Bank, a division of South Africa’s First Rand Bank Limited, served as the exclusive financial adviser to Chappal Energies throughout the deal.
Under the terms of the agreement, Equinor retains no significant liabilities, except for certain contractual obligations to Chappal Energies, as outlined in the transaction documents.
Also, all of Equinor’s Nigerian assets have been transferred to Chappal Energies as part of the acquisition.
IOCs’ divestment has become a fad
After many years of operations, many International Oil Companies (IOCs), such as Shell, ExxonMobil, Eni, and Equinor, are divesting from Nigeria’s onshore sector and allowing local energy players to run the show.
In October 2024, the Federal Government approved the application of a $1.28 billion sale of ExxonMobil Corporation’s onshore assets to Seplat Energy, more than two years after the deal was struck.
Eni, another IOC, sold 100 per cent of its shareholding interest in Nigerian Agip Oil Company (NAOC) to Oando for a total consideration of $783 million, which comprises consideration for the asset and reimbursement.
There is also the Shell Petroleum Development Company (SPDC) Limited and Renaissance Africa Energy Company Limited deal, which is awaiting regulatory approval.
Shell announced an agreement to sell its 30 per cent stake in SPDC to a local consortium, Renaissance, for over $2.4 billion to streamline its portfolio and direct disciplined investments towards deepwater and integrated gas ventures in Nigeria.
The assets include an estimated 6.73 billion barrels of crude oil and condensate, along with 56.27 trillion cubic feet of gas.
Tinubu-led Oando takes over Eni’s Nigerian Agip Oil Company in $783m deal
Meanwhile, TheRadar reported that Oando Plc has taken over Nigerian Agip Oil Company (NAOC) from Eni following the acquisition of a 100 per cent shareholding interest in the company for a total consideration of $783 million, which comprises consideration for the asset and reimbursement.
This was contained in a statement sent to the Nigerian Exchange (NGX) Limited on Thursday, August 22, by Oando’s Chief Compliance Officer and Company Secretary, Ms Ayotola Jagun.
