NUPRC clears air on Wale Tinubu’s Oando-NAOC deal

Akinwande Soji-Ojo

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has said the approval of the divestment deal between Oando and Nigerian Agip Oil Company (NAOC) followed due process and was done in compliance with existing regulations.

A statement on Monday by the Head, Public Affairs Unit of the upstream regulator, Olaide Shonola, said that the explanation became necessary because of NUPRC’s avowed commitment to transparency and belief in the right of the public to know about its regulatory activities.

Recall that former vice president, Atiku Abubakar, had recently raised some questions over the $783 million acquisition, alleging that the deal was unduly accelerated as a result of the relationship between the Chief Executive Officer of the indigenous oil firm, Wale Tinubu and President Bola Tinubu.

“The commission wishes the public to be aware that the approvals given to the NAOC-Oando and Equinor – Chappal divestments were in accordance with the Petroleum Industry Act (PIA) 2021, defined regulatory framework, and standard consent approval process set by the Commission under the PIA,” Shonola said

As for the divestment by Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Offshore Limited (Seplat), which Atiku said was being unduly delayed, the statement noted that it is also currently undergoing the same consent approval process and is expected to be completed within the 120-day timeline provided by the PIA.

“Furthermore, the commission’s thorough evaluation and due diligence process, anchored on the Seven Pillars of the Divestment Framework, ensured that potential assignees were capable and compliant with legal requirements and that all legacy liabilities were identified and appropriately managed.

“The commission subsequently made recommendations to the Honourable Minister of Petroleum Resources based on comprehensive assessments which covered the timeline for review of application under the PIA and the commission’s regulatory process,” the upstream regulator stated.

On a comparative basis, NUPEC said MPNU through a letter dated February 24, 2022, notified the commission of its intention to assign 100 per cent of its issued shares to Seplat Offshore Energy Limited.

Shonola said the commission did not consent to this assignment because MPNU failed to obtain a waiver of pre-emption rights as well as the consent of NNPC, its partner on the blocks to the divestment.

“It is worth pointing out that NNPC’s right to pre-emption and consent under the NNPCL/MPNU Joint Venture Joint Operating Agreement was the subject of Suit No: FCT/HC/BW/173/2022 Nigerian National Petroleum Company Limited versus Mobil Producing Nigeria Unlimited, Mobil Development Nigeria Inc., Mobil Exploration Nigeria Inc. and Nigerian Upstream Petroleum Regulatory Commission,” she added.

But in June 2024, NNPC and MPNU, the commission said, resolved their dispute through a letter dated June 26, 2024, informing the agency of the resolution of the dispute.

“Upon resolution of this dispute, the commission communicated its no-objection decision to the assignment via a letter dated July 4, 2024 and requested MPNU to provide information and documentation required under the commission’s due diligence checklist to enable the commission conduct its due diligence as required under the PIA.

“MPNU by letter dated July 18, 2024 provided the information requested by the commission. Accordingly, MPNU’s application to the commission for consent is currently undergoing due diligence review, under the same divestment framework applied to the NAOC-Oando and Equinor-Chappal divestment.

“The commission’s due diligence process is ongoing and within the 120-day timeline required by the PIA,” she said.

Shonola assured the public that the process for approving divestment applications is guided by the provisions of the PIA and clearly defined frameworks in the assignment regulations, guided by international best practices.

“NUPRC, as an organisation guided by law and professionalism, will continue to pursue its statutory mandate in a legal, independent, technical, commercial, and professional manner, operating under the authority of the PIA,” the statement said.