NNPC retail surrenders control to OVH energy, operator of Oando asset
NNPC Retail, the downstream division of the Nigerian National Petroleum Company Limited, has been dissolved following a court-approved transfer of its ownership and assets to OVH Energy Marketing Limited. The ruling effectively terminates NNPC Retail, Nigeria’s leading petrol importer, and grants full control of its operations to OVH Energy.
This development stems from a controversial acquisition reported by PREMIUM TIMES, where OVH Energy assumed management of NNPC Retail, leading to criticism from an NNPC insider who deemed the transaction “the most ridiculous business acquisition in the world.”
In October 2022, NNPC announced it had acquired OVH Energy Marketing, which operates Oando’s downstream assets. The deal aimed to leverage OVH’s extensive resources and commercial capabilities to enhance NNPC Retail’s operations.
NNPC acquired OVH from Nueoil Energy Limited shortly after Nueoil had purchased OVH in September 2022. Two months ago, NNPC Retail, OVH, and Nueoil jointly petitioned the Federal High Court in Lagos for orders including the dissolution of NNPC Retail and Nueoil and the transfer of their assets to OVH Energy. Justice C.J. Aneke granted these orders, making the merger effective from January 1, 2024.
The court’s decision was based on a petition filed on June 24 by the three companies, with the ruling published in the Nigerian government gazette.
The acquisition includes OVH Energy’s extensive assets, such as a reception jetty with a capacity of 240,000 metric tonnes per month, eight LPG plants, three lube blending plants, three aviation depots, and 12 warehouses.
A PREMIUM TIMES investigation in June 2023 uncovered secretive deals and a convoluted ownership structure behind the acquisition, revealing discrepancies in OVH Energy’s claimed number of filling stations and noting that the former OVH CEO, Huub Stokman, became NNPC Retail’s new Managing Director. The investigation also highlighted a deteriorating work environment at NNPC Retail under OVH’s management.
Despite the court ruling, employees at NNPC Retail have expressed concerns about the takeover, describing it as “criminal” and questioning the logic of the acquisition. They noted that while the company’s profit-making status was a factor in the original acquisition rationale, they are now subordinate to OVH.
The House of Representatives has initiated an investigation into the acquisition, with many lawmakers critical of a report presented on the matter. This inquiry is ongoing under the House Committee on Petroleum Resources (Downstream).
In February, the Nigeria Transparency Council (NTC) petitioned the House Committee on Downstream Petroleum to investigate the NNPCL’s payment of N140 billion for OVH Energy Downstream Assets and to suspend Mele Kyari-led NNPCL management. The NTC alleged that the acquisition cost was inflated and that some assets may not fully belong to OVH.
The NTC’s statement pointed out that while NNPC claimed to have acquired OVH Energy, the actual price and seller were not disclosed. The NNPC’s reported profits from the acquisition have been disputed, and recent revelations indicate that the acquisition cost was over $325.09 million (N140.559 billion), with allegations that some assets were not properly owned or licensed.
