Shell plc will sell its Nigerian onshore subsidiary Shell Petroleum Development Co. of Nigeria Ltd. (SPDC) to Renaissance, a Nigerian-based consortium comprised of ND Western, Aradel Energy, First E&P, Waltersmith, and Petrolin, for about $1.3 billion. Shell could see extra cash payments up to $1.1 billion, primarily relating to prior receivables and cash balances in the business.
The deal aligns with Shell’s 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,” said Zoë Yujnovich, Shell’s integrated gas and upstream director, in a release Jan. 17.
The SPDC joint venture holds 15 oil mining leases for petroleum operations onshore and three for petroleum operations in shallow water in Nigeria. It is operated by SPDC. On Dec. 31, 2022, SEC proved reserves that are the subject of the deal were about 458 MMboe.
Shell said the deal has been designed to preserve the full range of SPDC's operating capabilities following the change of ownership, including the technical expertise, management systems, and processes that SPDC implements on behalf of the companies in the SPDC joint venture. Following completion, Shell will retain a role in supporting the management of SPDC JV infrastructure that supply a major portion of the feed gas to Nigeria LNG (NLNG).
Deal completion is subject to approvals by the Federal Government of Nigeria and other conditions.
The SPDC JV is an unincorporated joint venture comprised of SPDC Ltd. (30%), the government owned Nigerian National Petroleum Corp. (55%), Total Exploration and Production Nigeria Ltd. (10%), and Nigeria Agip Oil Co. Ltd. (5%).
Alex Procyk | Upstream Editor
Alex Procyk is Upstream Editor at Oil & Gas Journal. He has also served as a principal technical professional at Halliburton and as a completion engineer at ConocoPhillips. He holds a BS in chemistry (1987) from Kent State University and a PhD in chemistry (1992) from Carnegie Mellon University. He is a member of the Society of Petroleum Engineers (SPE).