Page 4 - AfrOil Week 31 2021

AfrOil COMMENTARY AfrOil

(Photo: SPDC)

Shell reportedly planning to

reduce its footprint in Nigeria

The Anglo-Dutch major is reportedly gearing up to unload its stake in SPDC

ROYAL Dutch Shell (UK/Netherlands) is an opportunity for Nigerian investors. Officials
reportedly gearing up to sell its stake in a Nige- in Abuja are reportedly eager to see the SPDC
WHAT: ria-focused joint venture known as Shell Petro- stake sold to an organisation with strong local
A Nigerian newspaper leum Development Co. of Nigeria Ltd (SPDC). ties. Even so, it remains to be seen whether such
says Shell is preparing to If the deal goes forward, it will greatly reduce a shift would help resolve the political tensions
exit SPDC and has chosen the international major’s footprint in Nigeria. that Shell has often faced in southern Nigeria.
an advisor for the sale. SPDC is the largest of Shell’s four Nigerian sub-
sidiaries – and, indeed, the largest single fossil Moving forward
WHY: fuel producer in the West African state. Its assets Shell has reportedly been mulling the sale for
The international major include more than 1,000 producing wells, eight some time. Sources close to SPDC told This
has multiple reasons for gas-processing plants and a pipeline network Day last week, though, that the Anglo-Dutch
considering divestment. more than 6,000 km long. giant had already hired an advisor for the sale.
Given the assets at stake, the sale could gen- UK-based Standard Chartered Bank will assist
WHAT NEXT: erate billions of dollars for Nigeria. Shell is the the international major with the transaction,
Nigeria’s government is largest privately owned shareholder in the joint they said.
reportedly keen to see
part of SPDC’s port- venture; it holds a stake of 30% in SPDC and acts According to the sources, the first phase of
folio assigned to local as operator, with the remaining equity divided the divestment process is already under way.
investors. between Nigerian National Petroleum Corp. Shell issued the sale documents last week and
(NNPC), with 55%; TotalEnergies (France) with expects potential investors to submit expres-
10%; and Eni (Italy) with 5%. sions of interest (EoIs) by September 10, they
At the same time, the sale could also represent said.

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