TotalEnergies Reacts to Report of Leaving Nigeria After Selling Company’s Share
- TotalEnergies has stated that it will not be leaving the Niger Delta after its recent $860 million deal with Chappal Energies
- The company’s country communication manager clarified that SPDC JV is an unincorporated joint venture between different companies
- He also explained that the company will give Chappal Energies its 10% participation interest in the remaining three SPDC JV licenses
Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.
With its $860 million sale and purchase agreement (SPA) with Chappal Energies, TotalEnergies has declared that it will not be departing the Niger Delta.
Source: UGC
This occured after TotalEnergies EP Nigeria, a subsidiary of the parent business, signed a SPA with Chappal Energies to sell its 10% stake in the SPDC JV licenses in Nigeria.
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Dr. Charles Ebereonwu, country communication manager of TotalEnergies in Nigeria, stated that the company is staying in the Niger Delta despite the $860 million SPA deal with Chappal Energies.
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The company clarified that that SPDC JV, which holds eighteen licenses in the Niger Delta, is an unincorporated joint venture between Shell Petroleum Development Company of Nigeria (30%, operator), TotalEnergies EP Nigeria (10%), and NAOC (5%). Nigerian National Petroleum firm Ltd holds the majority of the shares (55%).
It said:
“TotalEnergies EP Nigeria will sell to Chappal Energies its 10% participating interest and all its rights and obligations in 15 licenses of SPDC JV, which are producing mainly oil. Production from these licenses represented approximately 14,000 barrels equivalent per day in Company share in 2023.
“TotalEnergies EP Nigeria will also transfer to Chappal Energies its 10% participating interest in the 3 other licenses of SPDC JV which are producing mainly gas (OML 23, OML 28 and OML 77), while retaining full economic interest in these licenses which currently account for 40% of Nigeria LNG gas supply.
“The transaction was concluded for a firm consideration of USD 860 million. Closing is subject to customary conditions, including regulatory approvals.”
According to Nicolas Terraz, president of exploration & production at TotalEnergies in a New Telegraph report, the company is still actively managing its portfolio in Nigeria in keeping with its plan to concentrate on its offshore oil and gas assets.
Commenting on the spate of countries leaving the country, Charles Abuede, a financial analyst said,
"The challenging business environment in Nigeria, characterised by unfriendly conditions due to multiple taxation issues, poses a significant obstacle to ease of doing business."
Commenting on the spate of businesses leaving the country, Charles Abuede, a financial analyst said that the challenging business environment in Nigeria, characterised by unfriendly conditions due to multiple taxation issues, poses a significant obstacle to ease of doing business.
"Businesses, particularly in the Fast-Moving Consumer Goods (FMCG) sector, grapple with reduced sales attributed to declining purchasing power and the substantial devaluation of the Naira."
Another energy giant sells company shares
Legit.ng earlier documented how Chappal Energies Mauritius Ltd agreed to pay $860 million to acquire TotalEnergies SE's 10% interest in the country's oil and gas assets.
Chappal Energies said in a statement on Wednesday, July 17, that the agreement includes a 10% stake in 15 oil mining leases as well as the Forcados and Bonny export terminals, which are a part of the Shell Petroleum Development Co. joint venture.
TotalEnergies, the massive French energy company, stated in a separate statement that production from those licenses accounted for about 14,000 barrels equivalent per day for the company last year.
Proofreading by James Ojo Adakole, journalist and copy editor at Legit.ng.
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Source: Legit.ng
