Nigeria’s government has approved Shell’s $2.4 billion sale of onshore oil assets to a local consortium, Renaissance Africa Energy.
The Federal Government of Nigeria has granted approval for the sale of Shell Petroleum Development Company’s (SPDC) onshore assets to Renaissance Africa Energy Company Limited, a local oil and gas consortium, for $2.4 billion. This key decision, announced on December 18, 2024, marks a transformative moment for Nigeria’s oil sector.
Key Details of the Approval
The approval, authorized by Heineken Lokpobiri, the Minister of State for Petroleum Resources, follows the agreement reached in January 2024 between Shell and the local consortium. Renaissance’s group includes ND Western Ltd., Aradel Holdings Plc, Petrolin Group, FIRS Exploration and Petroleum Development Co., and Waltersmith Group.
The sale is a significant step after challenges earlier in the year, when the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) blocked the deal over regulatory concerns. Gbenga Komolafe, CEO of NUPRC, had cited the consortium’s inability to meet necessary regulatory requirements. However, the government’s decision to approve the sale came after Shell’s continued investments, such as the Bonga North initiative, played a role in influencing the final outcome.
Initially, Shell agreed to sell its Nigerian onshore assets for approximately $1.3 billion, but following negotiations, the final sale price was increased to $2.4 billion. The assets involved are vast, containing 6.73 billion barrels of oil and condensate, and 56.27 trillion cubic feet of gas.
Shell’s historical operations in Nigeria have been marred by lawsuits, human rights violations, and significant environmental damage, particularly in the Niger Delta region. The NUPRC had previously indicated that it would approve the sale only if SPDC addressed past oil spills and committed to funding cleanup efforts.
Environmental and human rights organizations, including Amnesty International, have raised concerns about the transaction. They have urged the Nigerian government to ensure that responsibilities for past environmental damages are fully addressed before the sale proceeds.
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