Seplat Energy to sell 10% NNPC joint venture stake for $281.6m

Seplat Energy Plc has entered into a binding agreement to sell a 10% working interest in assets held by its joint venture with the Nigerian National Petroleum Company Limited (NNPC Ltd). The transaction is valued at approximately $281.6 million. The agreement was signed by Seplat's subsidiaries, Seplat Energy Offshore Limited (SEOL) and Seplat Energy Producing Nigeria Unlimited (SEPNU), with NNPC Ltd. Completion of the deal is contingent upon regulatory approvals and other standard conditions, with an expected closing in the second half of 2026 and an effective date of April 1, 2026. Following the transaction, SEPNU will maintain a 30% working interest and continue to operate the joint venture assets. NNPC Ltd.'s stake will increase from 60% to 70%. Seplat Energy will retain full ownership of SEPNU. The company stated that the proceeds will be allocated according to its capital framework, with roughly 50% designated for debt reduction and the other 50% for enhancing shareholder returns. Seplat Energy plans to distribute approximately $140 million, or 23.3 U.S. cents per share, to shareholders as a transaction dividend upon completion, in addition to its regular business performance dividend. The company has also targeted repaying up to $300 million in gross debt, having already paid $200 million of an Advanced Payment Facility in the second quarter of 2026, with the remaining $100 million due after the deal closes. The transaction is not expected to impact the 2026 production targets of the NNPCL/SEPNU Joint Venture, which has shown strong performance year-to-date. However, SEPNU's contribution to the group's production guidance will decrease from approximately 80,000 barrels of oil equivalent per day (kboepd) to about 65,000 kboepd. Seplat's 2030 production target will also be adjusted from 200,000 boepd (net working interest) to 170,000 boepd, pending deal completion. The company asserts that the transaction proceeds and reduced capital expenditure will largely offset the impact of the lower working interest. Seplat remains committed to distributing 40-50% of its free cash flow to shareholders between 2026 and 2030, aiming for at least $1 billion in cumulative distributions.