Shell Further Completes Its Nigerian Asset Disposal

Published at 05:05PM - 23/10/14

Royal Dutch Shell has announced this week that it will be disposing of the full portfolio of Nigerian oil assets that it put on to the market in 2013. A spokesperson said that the necessary agreements had now been signed, in a move that sees the Anglo-Dutch giant continue to lessen its exposure to the country.

A buying consortium which includes Mart Resources, the Canadian firm, is to buy a 45pc ownership stake in Oil Mining Lease 18 from Shell, Total SA and Eni SpA. However, the particulars of the deal are yet to be announced.

The block’s remaining 55pc ownership interested will be kept by Nigeria’s National Petroleum Co. The block produces 30,000 barrels daily at peak. The purchase will be subject to a broad range of legal terms and conditions, which will include authorisation by Nigeria’s government of the terms of the sale.

The latest news means that Shell has now entered into purchase and sale agreements for four oil blocks, as well as for the oil pipeline Nembe Creek Trunk Pipeline. The sales process is still in progress and it will be subject to formal approval.

The sales have been driven due to ongoing and troubling levels of oil theft, combined with continuing violence in the Niger Delta. The problems have seen a sizeable number of gas platform operators selling their assets to smaller companies, many of which are Nigerian-owned. Shell has been working on the deals for several months.

It will also be selling Oil Mining License 29 to a consortium for over $2.5 billion, pending approval from the Nigerian government’s oil minister. This asset is the largest of Shell’s sales in the southern Niger Delta.

Shell and the companies involved have declined to comment further at this stage. In July, ConocoPhillips, the US oil and gas operator, finalised its sale of oil assets in Nigeria to Oando Plc, a local company, for $1.5 billion.

Last updated on 11:54AM - 25/10/14