(Reuters) – Nigeria’s Seplat Energy said on Friday its offshore unit had entered a sale and purchase agreement to buy the entire share capital of Exxon Mobil’s Nigerian offshore shallow water business for $1.28 billion.
The deal involves a further contingent consideration of up to $300 million based on the oil price and the average production of the unit, Mobil Producing Nigeria Unlimited, over a five-year period, Seplat Energy said in a statement.
The deal implies an EV/2P ratio – used to measure the valuation of oil and gas companies – of $2.9 per barrel of oil equivalent, with “significant gas upside potential”, Seplat said.
Seplat is listed on the London and Nigerian stock exchanges.
(Reporting by Carolyn Cohn in London; editing by Jason Neely)
