NNPC Now In Control Of Addax Petroleum After Successful Takeover
Officially, the Nigerian National Petroleum Company has taken over Addax Petroleum Development Nigeria Ltd’s production-sharing contract assets. This deal ends a 24-year-old PSC relationship between NNPC & Addax Petroleum. After fulfilling their closing obligations, the NNPC and Addax Petroleum ended their relationship amicably. Three months after the Addax Transfer, Settlement, and Exit Agreement (ATSEA), the assets were taken over for the PSC oil blocks, OMLs 123/124 and 126/137.
Sinopec, a Chinese state-owned firm, owns Addax Petroleum. The NNPC stated that all closing obligations had been fulfilled and that the assets were transferred to the Concessionaire, NNPC Limited. The NNPC stated that it had taken the necessary steps to assume the assets and ensure a smooth, peaceful, and quick exit for Addax Petroleum Ltd. As a first step, the asset will be operated on an interim basis. Then, a replacement PSC contractor will be appointed. NNPC will continue to be the Concessionaire for the assets according to existing laws and regulations.
The TSEA was concluded in November 2022 and the oil wells were transferred to NNPC on January 31, 2023. Antan Producing Limited was appointed interim operator of OMLs 123/124, 126/137 by Addax Petroleum. This transfer is in preparation for the establishment of a substantive replacement PSC. Antan Producing Ltd’s Transition Team leader, Mr. Sagiru Jajere has been appointed as its managing director.
Before the recent amicable settlement, Addax and NNPC had been engaged in a lengthy dispute over the operation. Exit negotiations and formalities are over and NNPC Ltd, together with the Office of the Attorney General of the Federation, NMDPRA, FIRS, EFCC and the FCCPC have reached an amicable and clean exit for Addax. This was achieved by resolving all contractual issues relating to the PSC, which included litigations that culminated in the execution of a Transfer, Settlement, and Exit Agreement.
The NNPC declared that it will make much-needed investments in the assets while also prudently conducting oil activities and creating value. NNPCL stated in a statement, that the transfer took place three months after the Addax Transfer, Settlement and Exit Agreement for the PSC oil blocks. The national oil company stated that it had taken the necessary steps to assume control of the assets and ensure a smooth, peaceful, and quick exit for Addax Petroleum.
The NNPC’s takeover of Addax Petroleum Development Nigeria Ltd’s PSC assets by the NNPC is a major event in the Nigerian oil and natural gas industry. The NNPC demonstrated its commitment to ensuring a smooth and amicable exit of Addax Petroleum by taking over the assets and temporarily operating them. Sagiru Jajere was appointed as the Transition Team leader. This is a clear sign that the NNPC takes responsibility for these assets and is willing to invest in them to make them more valuable. This is a positive step forward for the industry and will hopefully set a good precedent for future transactions in oil and gas.