Equinor has recently announced the sale of its Nigerian oil business to Chappal Energies, as revealed in a statement released on Wednesday, November 29. The company has entered into an agreement to divest Equinor Nigeria Energy Company (ENEC), which possesses a 54% stake in the oil and gas lease OML 128, inclusive of a share in the Agbami oil field operated by Chevron.
Operating in Nigeria since 1992, Equinor has played a significant role in the development of the Agbami field, Nigeria’s largest deep-water oil field. The Agbami field, in production since 2008, has yielded over 1 billion barrels of oil, contributing to profits for its partners and the overall benefit of Nigeria.
However, the completion of the deal is contingent upon meeting specific conditions, including regulatory approvals and adherence to contract terms. Nina Koch, Equinor’s senior vice president for Africa Operations, highlighted the importance of Nigeria to Equinor over the past three decades. She emphasized that the transaction with Chappal Energies aligns with Equinor’s strategic focus by optimizing its international oil and gas portfolio.
Chappal Energies, the acquiring entity, is a Nigerian-owned energy company committed to the further development of these assets. Ufoma Immanuel, Managing Director of Chappal Energies, expressed enthusiasm about taking over from Equinor, emphasizing their commitment to value creation, environmental stewardship, and community engagement. Immanuel stated, “We are confident in our ability to make a lasting impact and are committed to fostering sustainable growth and contributing to Nigeria’s economic prosperity now and in the future.”
Looking back to January 2023, Equinor had signaled its intent to divest its stake in the Nigerian offshore Agbami oilfield. At that time, Equinor reported an investment of over $3.5 billion in its 20.21% stake in the Agbami oil field, where Chevron holds a 67.30% interest as the operator, and Prime 127 holds the remaining 12.49%. Equinor’s asset sale process was initiated following a 2022 deal with the Nigerian National Petroleum Company (NNPC) Limited, extending the license for offshore block OML 128, part of the Agbami field, by two decades.
Sources indicate a significant decline in production from the Agbami field in recent years, dropping from 36,000 barrels of oil equivalent per day (boepd) in 2019 to 29,000 boepd in 2020. Equinor’s decision to exit aligns with its strategy to focus on newer and more lucrative assets. As the energy landscape evolves, this transaction reflects the ongoing adjustments in the portfolios of major players to align with changing market dynamics and strategic priorities.
Support InfoStride News' Credible Journalism: Only credible journalism can guarantee a fair, accountable and transparent society, including democracy and government. It involves a lot of efforts and money. We need your support. Click here to Donate