This week proves there’s never a dull moment in the Nigerian upstream oil sector.

If it’s not international oil companies (IOCs) leaving, it’s Nigeria losing hundreds of thousands of oil barrels to vandalism and theft—just another day in the upstream oil sector. The latest event that had everyone in a tizzy was the showdown between the minister of petroleum and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Key takeaways:

  1. ExxonMobil is trying to sell Mobil Producing Nigeria Unlimited (MPNU) to Seplat as it divests from Nigeria’s onshore and shallow water assets.

  2. First, the minister of petroleum (President Buhari) approved the transaction. A few hours later, the upstream regulator, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), rejected the president’s approval. And then, a day later, the president reversed his approval. This raises a big issue of regulatory uncertainty.

  3. Regulatory uncertainty scares away investors as it makes Nigeria’s upstream oil sector even riskier than it already is.

We’ll get into the details later, but essentially, the minister of petroleum and the NUPRC released statements within hours, communicating opposing stances on the same issue. Worse, the minister of petroleum changed his mind a day later. If it’s not apparent, I’m referring to the Seplat Exxon Mobil transaction. This regulatory collision gets more heated when we unmask the minister of petroleum—it’s President Buhari.

So, amid all this regulatory uncertainty, the question on everyone’s lips is, “Would the real regulator of the Nigerian upstream oil sector please stand up?”

It’s funny because regulatory uncertainty was one of the issues the Petroleum Industry Act (PIA) tried to solve. Before the PIA, there were regulatory overlaps between the department of petroleum resources (DPR), the Petroleum products pricing regulatory agency (PPPRA) and the Nigerian National Petroleum Corporation (NNPC).  Until 1988, DPR, the oil sector’s regulator, was a unit in NNPC, a company it was supposed to regulate. After that, DPR became independent, but other regulators still had issues. One incident that comes to mind was in March 2021, when the PPPRA, whose job was to set petrol prices, announced an increase in petrol prices from ₦162/litre to about ₦200/litre. Predictably, there was a backlash, which led the NNPC to release a statement that prices would remain the same. The PPPRA deleted its statement hours later, and petrol prices remained at ₦162/litre.

To solve the issue of regulatory uncertainty, the PIA made the DPR and