TotalEnergies’ $860 Million Nigeria Exit Deal Collapses
French energy giant’s divestment plans suffer major setback as regulators revoke approval citing unmet financial obligations
TotalEnergies’ strategic retreat from Nigeria’s onshore oilfields has hit a major roadblock after regulators revoked approval for its planned $860 million sale of a 10 percent stake in the Shell Petroleum Development Company (SPDC) joint venture to Chappal Energies. The collapse represents a significant setback for the French energy major’s efforts to shed older, high-risk assets in the West African nation.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) withdrew its earlier consent after both parties failed to meet strict financial and regulatory conditions attached to the transaction. “The ministerial consent was accompanied by certain financial obligations to the Nigerian people with strict deadlines. However, both parties failed to meet their financial commitments after repeated extensions, forcing the commission to cancel the deal,” NUPRC spokesperson Eniola Akinkuotu stated.
Sources familiar with the matter revealed that Chappal Energies, the Mauritius-based buyer, was unable to raise the full $860 million purchase price, leaving TotalEnergies unable to meet associated obligations including regulatory fees and provisions for environmental liabilities.
The failure leaves TotalEnergies still tied to 15 oil-producing licenses and three gas fields that supplied approximately 40 percent of its Nigeria LNG gas in 2023. This prolongs the company’s exposure to the troubled SPDC joint venture, where operational challenges including rampant oil theft, spills, sabotage, and community disputes have made onshore operations increasingly unviable.
The setback also jeopardizes TotalEnergies’ broader deleveraging plans, as the company’s debt ballooned 89 percent to $25.9 billion by July. Chief Executive Patrick Pouyanne had told investors the Nigerian divestment was one of three asset sales expected to bring in $3.5 billion this year.
While rivals including Shell, ExxonMobil, Eni, and Equinor have successfully sold onshore Nigerian assets in recent years, TotalEnergies’ failed exit underscores the difficulties of navigating regulatory hurdles and financing risks in Africa’s largest oil producer.
Source: hallmarknews.com
