Chad’s parliament has passed the bill to nationalise the assets that the Africa-focussed oil and gas producer had purchased from the US-based oil and gas company in December last year
The government of Chad has nationalised the oil assets and rights that Savannah Energy had acquired from Esso Exploration and Production Chad, an affiliate of ExxonMobil, last year.
In December last year, the US-based oil and gas company completed the sale of its operations in Chad and Cameroon to Savannah for a total consideration of $407m.
The government of Chad challenged the agreement and the country’s parliament has passed the bill to nationalise the assets purchased by the Africa-focused oil and gas producer.
Among 175 representatives present on Chad’s parliament floor, a total of 172 lawmakers supported the law to nationalise the assets, reported Reuters.
Last week, Chad’s energy and hydrocarbons ministry said that all the assets and rights will be nationalised, including hydrocarbon permits, and exploration and production authorisations.
Chad Minister of Petroleum and Energy Djerassem Le Bemadjiel said: “Savannah and Esso – ExxonMobil have taken actions that pose serious and immediate threats to public order in Chad as well as to all actors in this economic sector that is crucial to the stability and development of Chad.”
Exxon was exiting from African operations with the decline in crude oil production and to focus on its liquefied natural gas (LNG) project in Mozambique, reported Reuters.
The company sold a 40% stake in the Doba oil project, which includes seven producing oilfields with a combined output of 28,000 barrels per day (bpd) to Savannah.
The British company also acquired a 40% stake in the Chad-Cameroon export transportation system, a 1,081km pipeline and floating storage and offloading facility offshore in Cameroon.
The government of Chad announced its plans to block Savannah’s purchase of Exxon Mobil assets, citing the final terms of the deal were different from the previously presented ones.
Last week, Savannah announced that it will pursue all its legal rights to contest the government’s move to nationalise its upstream assets in the country.