Shell confirms exit plan, shops for local investors

Royal Dutch Shell has engaged Standard Chartered to shop for local investors to buy some of its onshore assets as the oil major blames insecurity, poor government engagement and the recently passed Petroleum Industry Bill (PIB) for pushing them out of Nigeria.

According to Shell the Nigeria’s Niger Delta businesses are for now not core to its on- going business strategy worldwide.

Shell first announced its plans to scale down its Nigerian onshore interests during its annual general meeting in May this year when the Chief Executive Officer (CEO) of Shell Ben van Buerden said that the company is reviewing some of its global operations.

“We have been reviewing positions that continue to be challenged from an environmental perspective … and a particular point of attention has been onshore oil in Nigeria” Buerden had said.

Before now Shell had launched some major divestment of its Nigerian assets. For instance on 15 January this year, SPDC completed the sale of its 30 per cent interest in OML 17 in the Eastern Niger Delta, and associated infrastructure, to TNOG Oil and Gas Ltd, a related company of Heirs Holdings Ltd and Transnational Corporation of Nigeria Plc, for a consideration of $533 million

SPDC operates the company’s shallow-water and onshore asset interests via its 30 percent interest in the SPDC joint venture, which supplies around 10 percent of Nigeria’s gas demand.

Sale documents were issued earlier last week and expressions of interest (EOIs) are due by 10 September, a source said.. The vendor is asking for non-binding offers in the subsequent second phase.

Shell is selling the business because it no longer views its activities in the Niger Delta as core to its ongoing strategy, which is driven by the ESG pressure from its investors, sources said, and as intimated by its CEO earlier this year.