TotalEnergies announced on Wednesday that it had sold its minority share in a significant Nigerian onshore oil joint venture to Chappal Energies, a company based in Mauritius, for $860 million.
In February, CEO Patrick Pouyanne revealed that TotalEnergies aimed to sell its 10% stake in the Shell Petroleum Development Company of Nigeria Limited (SPDC).
The company has faced numerous oil spills due to theft, sabotage, and functional challenges, resulting in costly repairs and substantial lawsuits.
Focusing on investments, Chappal Energies targets deep value and distressed brownfield upstream assets within the Niger Delta region.
According to the company, the sale involves an interest in 15 licenses that predominantly produce oil, generating 14,000 barrels of oil-equivalent per day for Total in 2023.
Three more licenses mainly focus on gas production and account for 40% of TotalEnergies’ LNG gas supply in Nigeria.
Total confirmed that it has transferred its stake in the gas licenses to Chappal, but will retain the share of production as well as access to the associated infrastructure and pipelines for supplying gas to the Nigeria LNG plant.
“This divestment enables us to concentrate our onshore Nigeria operations exclusively on the integrated gas value chain and is aimed at ensuring a steady supply of feed gas to Nigeria LNG in the future,” stated Nicolas Terraz, president of exploration and production at TotalEnergies.
The deal is projected to be completed by year-end, contingent upon regulatory approvals.
Additionally, earlier this year, Shell reached an agreement to sell its 30% stake in SPDC to a consortium of mostly local firms for as much as $2.4 billion.
The Nigerian National Petroleum Corporation (NNPC) owns 55% of the joint venture, while Italy’s Eni holds a 5% stake. In recent years, Exxon Mobil, Eni, and Norway’s Equinor have divested assets in Nigeria to concentrate on newer, more lucrative operations in other regions.
TotalEnergies reported a production of 219,000 barrels of oil equivalent per day in Nigeria in 2023, solidifying its position as a key operator of offshore fields in the country.
The company is deeply involved in the region’s energy landscape, emphasising both oil and gas extraction while prioritising sustainable practices to improve its operations.