The government of Chad is in the midst of nationalizing all assets owned by private oil company Exxon Mobil (NYSE: XOM), in an unprecedented move that hasn’t been common in over fifty years.
As reported by the Associated Press, the land-locked country in North-Central Africa is taking over all assets owned by Exxon Mobil, including the company’s exploration and hydrocarbon permits. ″The finance and budget minister must make sure the said decree is implemented from the date of its publishing,” announced the government’s general secretary Haliki Choua Mahamat.
Exxon, which has been extracting oil in Chad for nearly 20 years and operating the Doba oil project, has been embroiled in a series of disputes with the country after the government halted the sale of the oil giant’s operations in 2022. The nationalization of private assets hasn’t been common since the 1960s and 1970s, but the country has been in turmoil after Mahamat Idriss Deby was declared president in light of his father’s passing in 2021— a move that erupted in protests since it didn’t follow the traditional succession line.
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“Expropriation of any sort without compensation is not a step in the right direction, because it is going to erode investor confidence in that particular country and once investors are jittery, they pull back their investment, so regulators and leaders in Africa need to play by the rules,” explained Nigerian-based Megathos Law Practice partner Olufola Wusu.
Information for this briefing was found via the Associated Press and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
