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Shell, traded on the NYSE under the ticker symbol SHEL, has struck a deal to offload its Nigerian onshore oil and gas subsidiary to a consortium of five companies for a colossal sum of up to $2.4 billion. However, this pivotal divestment does not indicate a retreat from the West African behemoth; instead, Shell will persist in bolstering its deepwater and integrated gas portfolios in the country.
Initially, Shell will pocket $1.3 billion for the acquisition of Shell Petroleum Development Company of Nigeria, with the buyer potentially coughing up an additional $1.1 billion to settle prior receivables and cash balances.
This decision has been in the cards for a while, with Shell endeavoring to rid itself of its Nigerian oil and gas business due to persistent issues such as spills and theft dating as far back as 2021.
Nevertheless, the transaction awaits the nod from Nigerian authorities. The journey to offloading Nigerian assets has been arduous for oil majors, as evident from Exxon Mobil’s protracted attempt to sell its Nigeria shallow-water oil assets, delayed by objections from the state-owned Nigerian National Petroleum Co. Similarly, Eni and Equinor are also entangled in the web of regulatory obstacles on the path to finalizing the sale of their Nigerian assets.
