The head of London-listed oil company Seplat wants to change how international investors view Nigeria. This comes after finally completing a difficult $1.28 billion deal with ExxonMobil that has made Seplat one of Nigeria’s largest oil producers.
Two years ago, CEO Roger Brown temporarily lost his visa for three months. This happened when unnamed “workers and shareholders” accused him of racism during the long process of buying Exxon’s oil and gas fields in the Niger Delta region.
It took almost three years and a new government to finish the deal, which was completed last December. Brown believes investors are wrong to value Seplat’s shares lower just because the company operates in Nigeria.
“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 purchase of Exxon’s business has given Seplat 11 onshore oil blocks, 48 oil and gas fields, three export terminals, and five gas processing facilities, making it one of Nigeria’s biggest local producers.
The deal will help Seplat increase production from 50,000 barrels daily to about 120,000 before September. That’s when Brown plans to meet with shareholders in London. “We’ll try to lay out the future and we’ll try to demystify what’s going on in Nigeria,” he said.
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This deal strengthens Seplat’s position among Nigerian oil companies like Oando and Heirs Energies. These local companies now control almost all of Nigeria’s onshore and shallow water oil assets after international companies like Shell, Exxon, and Addax Petroleum left.
Brown believes these changes are positive for the industry. He notes that Nigerian producers are committed to increasing production from these fields, unlike the international oil companies, which weren’t investing in them.
“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 started in 2009 by Nigerian businessman Austin Avuru. Brown, who had been the chief financial officer since 2013, became CEO in 2020 when Avuru retired.
Seplat’s growth hasn’t been easy. The company reached a deal with Exxon in February 2022, but faced long delays when Nigeria’s state-owned oil company got a court order blocking the sale.
Then-president Muhammadu Buhari seemed to approve the deal in August 2022 but changed his mind just three days later.
The next year, while the fight over the deal continued, Brown was accused of racism and temporarily lost his visa – allegations that Seplat strongly denied.
Brown said he was “shocked” by these claims but worked through the courts to solve the problem and trusted “the process.”
Finally, President Bola Tinubu approved the deal last year along with several similar transactions. Brown was impressed with the new government’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 another sign of change welcomed by many in the industry, Tinubu recently fired the entire 11-person board of the national oil company and replaced its long-serving CEO with Bashir Ojulari, a former Shell engineer. Former Seplat CEO Avuru is now one of the new board members.
Over the next five years, Brown plans to increase production beyond 110,000 barrels of oil equivalent per day through more drilling, supply more gas to the Nigerian market, and begin exporting liquefied natural gas.
“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.”
