Nigeria‘s state-owned oil company, NNPC Ltd, has taken over four major oil mining blocks after Sinopec’s Addax Petroleum Development (Nigeria) Ltd exited the assets.
The two companies signed a Memorandum of Understanding covering the transfer, settlement and exit agreement for Oil Mining Leases (OML) 123/124 and OML 126/137.
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According to NNPC’s Chief Investment Officer at NNPC Upstream Investment Management Services, Bala Wunti, the agreement means Addax Petroleum is no longer the Production Sharing Contract (PSC) contractor for the assets.
The terms of the agreement were not disclosed by either NNPC or Wunti.
Addax Petroleum began operations in Nigeria in 1998 after signing Production Sharing Contracts with NNPC. However, the company faced challenges after Nigeria’s petroleum regulator revoked the leases in April 2021, accusing Addax of failing to sufficiently develop the oil blocks. The decision was later reversed by President Muhammadu Buhari.
Three of the affected oil leases contain producing fields, according to information from Addax Petroleum.
The transfer comes as NNPC strengthens its asset base following its transition into a commercial entity in July. The company is also preparing for a planned initial public offering expected in the second half of the following year.
