Mauritius-based Chappal Energies has recently acquired TotalEnergies’ minority share in a significant onshore oil joint venture in Nigeria.
This transaction includes ownership interests in 15 licenses, primarily oil-producing, with a combined output of 14,000 barrels of oil equivalent per day in 2023.
The decision to divest was driven by costly repairs stemming from challenges in Nigeria’s oil sector, prompting TotalEnergies to streamline its operations.
TotalEnergies had previously signaled its intent to sell its 10% stake in the Shell Petroleum Development Company of Nigeria Limited (SPDC), citing issues such as oil spills, theft, and operational complexities. These challenges necessitated substantial investments in rehabilitation efforts and legal disputes, as reported by Reuters.
In addition to the oil licenses, the divestment includes three licenses predominantly producing gas, contributing significantly to TotalEnergies’ Nigeria LNG production by 40%.
While the ownership of gas production remains with TotalEnergies, the Mauritian company will acquire the participation stake in these licenses, ensuring continuity in gas supply to the Nigeria LNG plant through existing infrastructure and pipelines.
Nicolas Terraz, President of Exploration & Production at TotalEnergies, emphasized that this strategic divestment allows the company to refocus its Nigerian operations exclusively on the integrated gas value chain. The transaction is expected to be finalized by the end of the year pending regulatory approvals.
Despite this divestment, TotalEnergies reiterated its commitment to Nigeria, highlighting a $6 billion investment plan unveiled last year for the nation’s oil and energy sectors, particularly emphasizing gas and offshore projects.
Nigeria remains a significant contributor to TotalEnergies’ global production, accounting for 8-10% of its total production and more than 18% of its global investment.
TotalEnergies’ exit from Nigeria’s onshore market marks the latest departure of a foreign oil firm after decades of operations in the region.
