Eni, the Italian oil and gas major, has received regulatory approval from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to sell its subsidiary Nigerian Agip Oil Company Limited (NAOC) to Oando Plc, a major domestic energy company.

Eni announced the sale of NAOC after receiving formal approval, 10 months after initially signing the deal in September 2023. This transaction is the first to be approved under Nigeria's new Petroleum Industry Act (PIA). 

Following this acquisition, Oando's reserves are expected to nearly double, increasing to 996mn barrels of oil equivalent (boe). Although the precise transaction price has not been officially disclosed, media reports indicate it may exceed $500mn.

NAOC holds interests in Nigeria across four onshore blocks (OML 60, 61, 62, and 63), operating these on behalf of the NAOC JV, which consists of NAOC Ltd (20%), Oando (20%), and NNPC E&P Limited (60%). Additionally, NAOC operates the Okpai 1 and 2 power plants, with a combined capacity of 960MW, and manages two onshore exploration leases, OPL 282 (90% ownership) and OPL 135 (48% ownership). These assets are set to be transferred to Oando. 

Earlier this month, NUPRC chief executive Gbenga Komolafe hinted at the impending approval of the deal, stating on July 3 that all necessary local and regulatory authorisations had been secured. 

Eli’s sale of NAOC does not include NAOC’s 5% participating interest in the Shell Production Development Company Joint Venture (SPDC JV), which includes major stakeholders such as Shell, TotalEnergies, and the Nigerian National Petroleum Corporation Ltd (NNPCL). This strategic decision enables Eni to maintain a presence in Nigeria's upstream sector, with ongoing investments in deepwater projects and a substantial stake in Nigeria LNG.

Eni's decision to divest from Nigeria aligns with a broader trend among major oil companies. Other international oil giants such as Shell (UK), ExxonMobil (US), and TotalEnergies (France) are also reevaluating their portfolios in the region. Eni has been active in Nigeria since 1962, reflecting a long-standing presence in the country's energy sector.