Seplat Energy Plc has signed a binding Heads of Agreement with the Nigerian National Petroleum Company Ltd (NNPC) to divest a 10 percent working interest in the NNPC/Seplat Energy Producing Nigeria Unlimited (SEPNU) joint venture for $281.6 million, equivalent to ₦384.38 billion. The deal, disclosed in a corporate filing with the Nigerian Exchange Ltd on Thursday, was executed through Seplat's subsidiaries, Seplat Energy Offshore Ltd and SEPNU, following earlier discussions with NNPC.
The transaction is subject to regulatory approvals and other customary conditions, with completion expected in the second half of 2026. The effective date of the transaction is 1 April. Once completed, the ownership structure of the joint venture will change significantly.
Ownership Changes and Operational Control
Upon completion, Seplat will retain a 30 percent working interest in the joint venture and will continue to serve as operator. NNPC's interest will rise from 60 percent to 70 percent. Seplat will remain the sole owner of SEPNU's share capital, ensuring the company retains strategic control over the venture's operations despite reducing its economic stake.
The agreement marks a notable realignment in one of Nigeria's key upstream partnerships. Seplat's continued operatorship is expected to provide stability as the joint venture executes its production and development plans.
Use of Proceeds: Debt Repayment and Special Dividend
Seplat said it intends to deploy the transaction proceeds according to its capital allocation strategy, with about half of the funds earmarked for debt reduction and the balance designated for enhanced shareholder returns. The company specified that approximately $140 million, or 23.3 US cents per share, will be paid out as a special cash dividend to shareholders upon completion, in addition to its regular dividend.
The debt-reduction initiative is part of a broader plan to repay up to $300 million in gross debt. Seplat noted that $200 million under its Advanced Payment Facility had already been settled in the second quarter of 2026, while the remaining $100 million would be repaid after the transaction closes. The company is also making progress on reducing leverage, with the proceeds from the sale supporting this objective.
Impact on Production Targets and Reserves
Seplat confirmed that the disposal will not affect the joint venture's 2026 production target. However, SEPNU's contribution to the group's overall production guidance will decline following the transaction. As a result, the company has revised its long-term production target for 2030 to 170,000 barrels of oil equivalent per day (boepd), down from the previous 200,000 boepd.
Group 2P reserves are also expected to fall by about 13 percent, to 872.9 million barrels of oil equivalent, upon completion of the deal. These adjustments reflect the reduced working interest and align with the company's portfolio strategy.
CEO Statement on the Transaction
Commenting on the agreement, Seplat Energy's Chief Executive Officer, Roger Brown, described the NNPCL/SEPNU joint venture as one of Nigeria's most strategic oil assets. According to Brown, the company remains aligned with NNPC on delivering value from the joint venture and unlocking its long-term production potential.
Brown added that Seplat's strong financial position enables it to use the proceeds to reward shareholders, reduce leverage, and strengthen future cash flows. The transaction underscores the ongoing collaboration between Seplat and NNPC to optimize the asset's performance.
Broader Implications
The transaction will increase NNPC's interest in the joint venture to 70 percent, giving the state-owned company majority control while Seplat continues to operate the assets. For Seplat, the deal provides a significant cash injection to strengthen its balance sheet and return value to shareholders. The completion of the sale, expected in H2 2026, will be closely watched by investors and industry observers as it reshapes one of Nigeria's key oil and gas production arrangements.
