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Chief Executive, NUPRC, Gbenga Komolafe
The Federal Government through the Nigerian Upstream Petroleum Regulatory Commission, says it has approved four out of five divestment requests received from international oil companies for regulatory approval.
This development signals a significant move towards facilitating investment and operational changes within the country’s oil sector.
The Chief Executive Officer of NUPRC, Gbenga Komolafe, disclosed the approval on Monday at an event to launch Project One Million Barrels Per Day Production in Abuja.
The NUPRC, which was established by the Petroleum Industry Act 2021, used the occasion to celebrate its three years of regulatory overhaul of the upstream industry.
Speaking in his keynote address, the NUPRC boss stated that the commission has leveraged the effectiveness of the Petroleum Act to eliminate outdated regulatory processes and encumbrance of exploration.
“In the last three years, we have made significant strides towards attaining these goals despite the persistent challenges of the global push for energy transition and the call for defunding of fossil fuel. Leveraging the PIA, we are addressing the legacy challenges of outdated regulatory processes, encumbrances to exploration,” he noted.
Revealing the development in the divestments of IOCs, Komolafe said that the commission received a total of five divestment requests.
He listed the approved request as Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited divestment, Equinor Nigeria Energy Company Limited to Project Odinmin Investments Limited, TotalEnergies EP Nigeria Limited to Telema
Energies Nigeria Limited, and the Nigerian Agip Oil Company Limited to Oando Petroleum and Natural Gas Company Limited divestment.
The fifth divestment, which involves the Shell Petroleum Development Company Limited’s assets to Renaissance Africa Energy Company Limited, didn’t pass regulatory checks.
Komolafe said, “We are happy today to announce the status of the divestment exercise conducted diligently by the Commission in line with the provisions of the PIA. Out of the total of five divestment applications for consent received by the Commission, a total of four, representing 80 per cent, passed the regulatory test and secured ministerial consent.
“The transactions are: Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited, Equinor Nigeria Energy Company Limited to Project Odinmin Investments Limited, Nigerian Agip Oil Company Limited to Oando Petroleum and Natural Gas Company Limited and TotalEnergies EP Nigeria Limited to Telema Energies Nigeria Limited.
“Also, the transaction in respect to 10 per cent divestment of Total Energies/ Telema Energies has received ministerial consent.“
He added, “The divestment of Shell Petroleum Development Company Limited’s assets to Renaissance Africa, Energy Company Limited could not scale regulatory test.”
These assets include an estimated 6.73bn barrels of crude oil and condensate, along with 56.27tn cubic feet of gas.
He said the divestment made possible by the provisions of the Petroleum Industry Act 2021 is the first to be handled in an orderly manner.
“I believe it is a success for our industry and it will go a long way in facilitating the achievements we have made in the oil and gas industry, ” he added.
He called on industry players to support NUPRC’s effort to restore sanity in the industry.
Komolafe further stated that initiatives have been taken to grow oil and gas reserves through studies and development activities to the current levels of 37.5bn barrels of Oil and 209.26tn.
On his part, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mele Kyari, stated the government has started replacing its infrastructure to boost evacuation of crude oil.
He said, “When you produce oil, you must evacuate it, and we know that today there are two challenges we are facing in this sector. It is the issue of vandalisation and oil theft. The government and security agencies are responding to this in collaboration with everyone in the industry.
“We also know that we are dealing with infrastructure that is over 50 years, older than most persons in this room. We are working to replace them because without changing those pipelines, the government cannot evacuate the additional barrels that we are going to produce particularly on the onshore assets.
“We are happy for this event hosted by our regulator. We are proud to be regulated and obey all your rules and we will see the results.”
