Shell Plc United Kingdom has reached an agreement to sell its Nigerian onshore subsidiary, Shell Petroleum Development Company of Nigeria Limited (SPDC).
According to a statement on the energy firm’s website, SPDC will be sold to Renaissance, a consortium of five companies comprising four exploration and production companies based in Nigeria and an international energy group. Sources have put the total cost of the deal in the region of $2.4 billion.
The oil firm restated that it remains committed to investments in the Niɠerian oil and gas sector.
According to the statement, completion of the transaction is subject to approvals by the Federal Government and other conditions.
Shell stated that the transaction had been designed to preserve the full range of SPDC’s operating capabilities following the change of ownership.
“This includes the technical expertise, management systems and processes that SPDC implements on behalf of all the companies in the SPDC Joint Venture (SPDC JV).
“SPDC’s staff will continue to be employed by the company as it transitions to new ownership.
“Following completion, Shell will retain a role in supporting the management of SPDC JV facilities that supply a major portion of the feed gas to Nigeria LNG (NLNG), to help Nigeria achieve maximum value from NLNG.
“This agreement marks an important milestone for Shell in Nigeria, aligning with our previously announced intent to exit onshore oil production in the Niger Delta.
“The transaction is simplifying our portfolio and focusing future disciplined investment in Nigeria on our Deepwater and Integrated Gas positions,” Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director, said.
Shell UK described the deal as a significant moment for SPDC, whose people have built it into a high-quality business over many years.
“Now, after decades as a pioneer in Nigeria’s energy sector, SPDC will move to its next chapter under the ownership of an experienced, ambitious Nigerian-led consortium.
“Shell sees a bright future in Nigeria with a positive investment outlook for its energy sector. We will continue to support the country’s growing energy needs and export ambitions in areas aligned with our strategy,” the statement said.
The SPDC JV is a joint venture comprising SPDC Ltd. (30%), the government owned Nigerian National Petroleum Corporation (55%), Total Exploration and Production Nigeria Ltd. (10%) and Nigeria Agip Oil Company Ltd (5%).
By Nathan Nwakamma
