By Tolúlopé Olátúnjí
The Nigerian National Petroleum Company Limited (NNPCL) has filed a motion with the High Court of the Federal Capital Territory in Abuja to discontinue its ongoing legal action against several subsidiaries of Mobil Nigeria and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
This new development comes as part of efforts to finalize a settlement agreement regarding the divestment of Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Offshore Limited.
The New Diplomat reports that the NNPCL’s legal counsel, Afe Babalola & Co.,filed a motion on June 11, 2024, requesting the court to allow the withdrawal of the suit and to strike it out, with an option to relist it should the settlement process fail. The motion is part of broader efforts to resolve the dispute amicably.
However, Isaika Popoola, who is litigation manager to the NNPCL detailed the history of the arbitration process and the terms of the settlement agreement, through an affidavit, noting that several meetings have been held to address the divestment of MPNU shares to Seplat.
The NNPCL stated:”The discontinuance is essential for completing the settlement process,”adding that the application complies with Order 24 of the High Court of the Federal Capital Territory Civil Procedure Rules 2018. The motion also ensures that NNPC retains the right to seek judicial recourse if the settlement is not successful.
The motion further highlights: “The applicant humbly urges Your Lordship to grant leave to discontinue this suit and consequently strike it off the court’s cause list. Granting this application aligns with the policy of this Honourable Court and facilitates the finalization of the settlement process.”
It would be recalled that on May 31, 2024, both the NNPC and ExxonMobil moved close to resolving their disagreement over the sale of ExxonMobil’s asset to Seplat. The settlement agreement between the NNPCand ExxonMobil follows President Bola Tinubu’s intervention in the dispute.
Recall also that the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, had noted recently that Nigeria had lost about $30 billion over the past two and a half years due to the unsuccessful divestment. According to reports, the crisis, which began in 2022, has also led to the loss of about 480,000 barrels of crude oil per day.
It would be recalled that ExxonMobil and Seplat Energy had announced a $1.6 billion sales agreement in 2022, a move that would enable Seplat to acquire ExxonMobil’s complete shares in MPNU. However, a letter from the NUPRC to ExxonMobil on May 16, 2022, halted the deal. The letter stated, amongst other things, that NNPC had the right to exercise its right of first refusal on the assets going by the rule and Law.
Similarly, the NNPCL equally objected to the sale and insisted on its right of pre-emption, reportedly making an offer above $1.6 billion to ExxonMobil.
After nearly two years of litigation, the crisis now appears to be nearing a seeming resolution.
