By Mary Izuaka

 

Shell Petroleum B.V. announced Tuesday that it has signed an agreement to sell its full interest in the Shell Nigeria Gas Group to Vaaris Energy Limited, a Nigerian firm.

Shell Nigeria Gas operates a domestic gas distribution business in Nigeria.

In a statement on Tuesday, Shell said the transaction is subject to regulatory conditions and approvals.

Until completion, it said the Shell Nigeria Gas Group will remain part of Shell and will continue to serve its customers and operate as usual.

Speaking on the transaction, Elohor Aiboni, Shell’s Country Chair in Nigeria, said: “Shell Nigeria Gas has served industrial and commercial customers in Nigeria for more than 25 years, supported by the commitment and expertise of its people.

“We believe this agreement provides a much stronger platform for the business’ next chapter under new ownership. Shell continues to focus on strategic Deepwater and Integrated Gas positions in Nigeria.”

The transaction, according to the statement, includes Shell Nigeria Gas Holding B.V., which was established in 2019 and holds all the shares (except for one) in Shell Nigeria Gas Limited.

Shell said the sale is consistent with its focus on simplifying its portfolio and concentrating investment in areas where it has competitive strengths.

The company said its continued focus on deepwater and integrated gas operations in Nigeria, including its interest in Nigeria LNG, reflects the strategy.

Shell Nigeria Gas Limited (SNG) was established in 1998 and supplies natural gas to industrial and commercial customers in Nigeria.

It operates around 170 km of pipeline infrastructure across Ogun, Abia and Rivers states, supplying more than 130 connected commercial and industrial customers.

The statement said SNG does not operate in upstream gas production, liquefied natural gas (LNG), or international gas trading.

Vaaris Energy Limited is a Nigerian energy company with interests across the oil and gas value chain and an existing operational footprint in the country.

ALSO READ: Shell to acquire Canadian energy company in $16.4 billion deal

Over the past three decades, Shell has been a dominant operator in Nigeria’s oil and gas industry, largely through its subsidiary, Shell Petroleum Development Company of Nigeria Limited (SPDC).

While its operations have generated substantial revenues for Nigeria, they have also attracted criticism over environmental degradation, litigation and community conflicts.

The supermajor recently sold its onshore and shallow-water operations in Nigeria in a $2.4 billion deal to relocate offshore.

In March last year, Renaissance Africa Energy Holdings announced that it had completed the acquisition of the entire equity holding in the Shell Petroleum Development Company of Nigeria (SPDC).