Shell agrees to sell Nigerian onshore subsidiary, SPDC for $2.4bn

Shell Plc said it has “reached an agreement to sell its Nigerian onshore subsidiary, The Shell Petroleum Development Company of Nigeria Limited.”

The SPDC is to be sold to Renaissance, a consortium of five companies comprising four exploration and production companies based in Nigeria and an international energy group for $2.4 billion.

However, the Shell said the completion of the transaction is subject to approvals by the Federal Government of Nigeria and other conditions.

In a statement on its website on Tuesday, it was disclosed that the transaction has been designed to preserve the full range of SPDC’s operating capabilities following the change of ownership.

This, it said, “includes the technical expertise, management systems and processes that SPDC implements on behalf of all the companies in the SPDC Joint Venture (SPDC JV)”.

The statement added that 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 Joint Venture facilities that supply a major portion of the feed gas to Nigeria LNG (NLNG), to help Nigeria achieve maximum value from NLNG,” the statement read partly.

“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, simplifying our portfolio and focusing future disciplined investment in Nigeria on our Deepwater and Integrated Gas positions” the statement quoted Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director, as having said.

The statement added, “It is 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 SPDC JV is an unincorporated joint venture comprised of 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%).

Source: Punch Newspaper