Mauritius-Based Chappal Energies Loses Stake in Nigerian Oil Blocks Bought From TotalEnergies

Chappal Energies Mauritius Limited has lost the 10 percent stake in a Nigerian joint venture previously known as Shell Petroleum Development Company (SPDC) that it bought from TotalEnergies last year.

In July 2024, Chappal Energies signed a sale and purchase agreement for the purchase of TotalEnergies EP Nigeria’s 10% interest in the SPDC JV licences for a consideration of $860 million.

SPDC JV was an unincorporated joint venture between state-owned Nigerian National Petroleum Corporation Ltd (55%), Shell Petroleum Development Company of Nigeria (30%, operator), TotalEnergies EP Nigeria (10%) and Nigerian Agip Oil Company (5%). Renaissance Africa Energy Company now holds a 30% stake following its acquisition of SPDC, while Oando has 5%.

Reuters reported that regulatory approval for the sale granted last October has been withdrawn because the two sides have not met financial commitments required to complete the deal, according to Eniola Akinkuoto, spokesperson for the Nigerian Upstream Petroleum Regulatory Commission.

“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,” Akinkuoto said on Tuesday.

READ MORE: How Mauritius-Based Startup Chappal Energies Took Nigerian Oil Sector By Storm

One source familiar with the negotiations said Chappal failed to raise the $860 million, and as a result, Total did not fulfil its requirement to pay regulatory fees and cover funds for environmental rehabilitation and future liabilities, according to Reuters.

Last year, Chappal Energies also successfully closed the purchase of Nigerian assets from Equinor for $1.2 billion, with financial backing from Mauritius Commercial Bank and commodities trader Trafigura.