The boss of London-listed Seplat wants to “demystify” Nigeria for international investors after completing a tortured billion-dollar deal with ExxonMobil that has transformed the company into one of country’s biggest oil producers.
Two years ago chief executive Roger Brown’s visa was revoked for three months after a petition from unidentified “workers and shareholders” accused him of racism amid a drawn-out effort to acquire Exxon’s onshore oil and gas blocks in the troubled Niger Delta.
Ultimately it took nearly three years and a change of government to complete the transaction, which was sealed in December. But Brown insisted that any Nigeria “discount” applied to Seplat’s shares was unwarranted.
“We’ve got a big discount on our share price for the Nigeria [factor],” the British executive told the Financial Times. “The only way to pierce that perception is just . . . keep growing production and keep talking about it.”
The $1.28bn acquisition of Exxon’s business, which was completed in December, has made Seplat one of Nigeria’s biggest domestic producers with an asset base of 11 onshore oil blocks, 48 oil and gasfields, three export terminals and five gas processing facilities.
The deal will enable it to expand production from 50,000 barrels a day to roughly 120,000 b/d before September, when Brown plans to address shareholders at an investor day in London. “We’ll try to lay out the future and we’ll try to demystify what’s going on in Nigeria,” he said
The transaction has consolidated Seplat’s position among a number of indigenous Nigerian oil companies, including Oando and Heirs Energies, that now control almost all of the country’s onshore and shallow water oil assets following the exit of international players including Shell, Exxon and Addax Petroleum.
The deals have transformed the shape of the sector in a positive way, Brown said, noting that the Nigerian producers were committed to increasing production from the fields they have acquired in a way that international oil companies (IOCs) were not doing.
“If you’re an IOC you’re looking all around the world where to put your money next, whereas the indigenous players, by and large, are only looking at Nigeria,” he said.
Seplat was co-founded in 2009 by its Nigerian former chief executive Austin Avuru. Brown, who had served as chief financial officer since 2013, took on the top job in 2020 following Avuru’s retirement.
Seplat’s path to growth, however, has not been straightforward. It reached an agreement with Exxon in February 2022, but faced a long delay after state-owned oil company the Nigerian National Petroleum Corp secured a court order blocking the sale.
Then-president Muhammadu Buhari appeared to have authorised the deal in August 2022 only to rescind the approval three days later.
The following year, while the battle over the transaction continued, Brown was accused of racism and had his visa temporarily revoked, allegations which Seplat strongly refuted.
Brown said he was “shocked” by the allegations but had worked through the courts to resolve the issue and trusted “the process”.
Ultimately, President Bola Tinubu approved the deal last year along with several other similar transactions. Brown said he had been impressed with the new administration’s “forensic” approach.
“It was an amazing process to have all of those deals unlocked and approved and it’s great for Nigeria [as] you’re going to start to see Nigeria [oil production] grow,” he said.
In a further sign of change that was welcomed by many in the sector, Tinubu this week sacked NNPC’s entire 11-person board and replaced its long-serving chief executive with a former Shell engineer Bashir Ojulari. Former Seplat chief Avuru is one of the new board members appointed.
Over the next five years Brown intends to expand production beyond 110,000 boe/d through further drilling, increase the volume of gas Seplat suppliers to the Nigerian market, while also beginning liquefied natural gas exports.
“I think it was time to move from Exxon ownership where there was very little investment since 2019 or even earlier than that,” he said. “Indigenous ownership of energy resources is clearly the way forward for Nigeria.”
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