Tag: shell

Nigeria has secured its third major gas investment in 18 months, with Shell approving a $2 billion Final Investment Decision (FID) for a new offshore gas development in the HI Field, located in Oil Mining Lease (OML) 144.

The project is expected to deliver about 350 million standard cubic feet of gas per day (mmscf/d) from 2028 — roughly one-third of the gas requirements of the Nigeria LNG Limited’s Train 7 project.

President Bola Tinubu welcomed the investment, describing it as another clear vote of confidence in Nigeria’s economic reforms and energy policies.

“This major FID announcement by Shell, their second in one year, is a clear validation of our wide-ranging reform efforts and a signal to the world that Nigeria is fully open for business and investment,” the President said.

The new decision brings total upstream investment commitments in Nigeria’s oil and gas sector to over $8 billion since Tinubu assumed office in 2023.

The announcement followed earlier approvals of the Ubeta Non-Associated Gas project and the Bonga North deepwater development, both seen as cornerstones of the administration’s energy revitalisation drive.

Together, the Ubeta and HI gas projects will supply up to 15 percent of the total feedgas requirements of the NLNG’s Trains 1 to 7, underpinning energy security and export reliability.

These investment inflows, it was gathered, are the result of targeted reforms introduced by the Tinubu administration, coordinated through the Office of the Special Adviser to the President on Energy.

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The reforms include fiscal incentives, streamlined regulatory processes, reduced contracting costs, and faster approval timelines — measures now enshrined in law.

The HI gas field, discovered in 1985, is being developed under Presidential Directive 40, which introduced a new fiscal framework to attract Non-Associated Gas investment in onshore and shallow offshore zones.

Special Adviser to the President on Energy, Olu Arowolo Verheijen, said the HI and Ubeta projects will solidify the foundation for NLNG’s Train 7 and enhance domestic energy access.

 “With the Ubeta FID and now the HI FID, we have secured the gas supply needed to make NLNG Train 7 not just possible, but transformative. These projects will strengthen Nigeria’s LNG exports, expand LPG availability for households, reduce imports, and boost foreign exchange earnings. And this is only the beginning — more FIDs are on the horizon”, Verheijen stated.

Shell’s Upstream President, Peter Costello, affirmed the company’s long-term commitment to Nigeria’s energy sector.

 “Following recent investment decisions related to the Bonga deep-water development, today’s announcement demonstrates our continued commitment to Nigeria’s energy sector, with a focus on Deepwater and Integrated Gas.

 “This project will grow Shell’s leading gas portfolio while supporting Nigeria’s ambition to become a more significant player in the global LNG market”, Costello said.

The NLNG Train 7 expansion, to which the new projects will contribute, is expected to increase Nigeria’s LNG capacity by 8 million metric tonnes annually, a 35 percent boost over current production.

The expansion will also stimulate thousands of direct and indirect jobs, strengthen SME participation in host communities, and expand the country’s clean energy footprint.

President Tinubu reaffirmed his administration’s commitment to sustaining a stable investment climate.

The recent completion of the acquisition of Shell Petroleum Development Company’s (SPDC) asset in Nigeria by the Renaissance Africa Energy Company, a consortium of ND Western, Aradel Holdings Plc, First Exploration and Petroleum Development Company Limited, Waltersmith Group and an international energy company, Petrolin Group, has been described as a “historic and the beginning of a new dawn in the energy sector.”

Reacting to the acquisition, valued at $2.4 billion, the Chief Executive Officer, ND Western Limited, Lanre Kalejaiye, in statement issued yesterday, said the deal represented a defining moment and that ND Western is committed to leveraging its technical expertise to sustain the growth of the sector.

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“This represents a defining moment for Nigeria’s oil and gas industry. As a partner in Renaissance Africa Energy Company, ND Western is committed to leveraging our technical and operational expertise and experience to sustain and grow production from the Renaissance assets. We look forward to working with our consortium partners to deliver sustainable energy solutions that will contribute to Nigeria’s economic prosperity,” he said.

The ND Western boss said the landmark deal reinforced the capacity of indigenous companies to develop the country’s hydrocarbon resources sustainably. Renaissance, he said, would enhance Nigeria’s energy security to drive industrial and economic growth, create jobs and boost local capacity development.

The deal, he further hinted, has positioned Renaissance as a “key player in Nigeria’s upstream sector.”

Shell has identified key enablers for boosting local content in the oil and gas industry, saying strategic partnerships, capacity building and adherence to regulations would help Nigeria to derive more value from the participation of local business in such operations.

The remark was made by the General Manager, Nigeria Content Development of Shell Petroleum Development Company of Nigeria Limited (SPDC) Olanrewaju Olawuyi, at a panel session on “Local Content Private Sector” at the recently concluded Sub-Saharan Africa International Petroleum Exhibition and Conference (SAIPEC) which held in Lagos.

Olawuyi said it was necessary to encourage indigenous companies to form partnerships to deliver major work scopes. “By awarding contracts worth $1.98 billion to Nigerian businesses in 2023, Shell has bolstered the capabilities of local firms, enabling them to become regional contractors,” he said.

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According to him, there is also the need to improve the expertise of local companies through training and provision of resources. “At Shell, we have implemented projects like the Nigerian Diving school to increase divers capacity in Nigeria, domestication of 3D printing technology and research work to develop synthetic base fluid for drilling. These are among many efforts to develop the capacity of suppliers.”

He said compliance with local content policies was essential as this had helped to ensure Shell’s operations benefit the local economy while at the same time fostering trust and collaboration with host communities.

Olawuyi explained: “Shell has learnt that the local content race is not a sprint, but a marathon and it makes a lot of business sense and creates value long term. As the energy sector evolves, local content strategies will shift from simple compliance to value-driven partnerships, technology adoption, and sustainable economic impact. Companies that invest in innovation, digital transformation, and workforce development will lead in shaping the next phase of local content growth.”

Nigeria can meet oil production targets and implement ambitious development programmes from deep-water oil and gas operations if it continues with policies to encourage investments and boost output in the sector, Managing Director, Shell Nigeria Exploration and Production Company Limited (SNEPCo,) Ronald Adams has said.

Adams, who spoke at the 9th Sub-Saharan Africa International Petroleum Exhibition and Conference (SAIPEC), yesterday in Lagos, noted that deep water is a compelling consideration for Nigeria if the country must meet its oil production targets and implement ambitious development programmes.

According to him, the country’s deep-water fields are home to some of the world’s most promising associated and non-associated gas reserves, with vast untapped potential that could play a vital role in powering Nigeria’s future, supporting cleaner energy and contributing to global emissions reduction.

He however said that: “this will require a favourable investment climate to attract capital and innovation to develop these gas resources responsibly and sustainably, ensuring long-term benefits for the country in meeting its energy and global sustainability goals.”

The SNEPCo boss welcomed reforms by government to attract investments especially the signing of three executive orders in February last year on tax incentives, local content compliance requirements and reduction of petroleum sector contracting costs and timelines, including the announcement of tax credits for new investments in deep-water oil and gas.

The reforms, he noted, should be part of a renewed strategy to attract investments “through fiscal and regulatory policies that are fit-for-purpose, forward-looking and competitive.

He said that for Nigeria to consistently reap the benefits from deep-water operations, it must address regulatory bottlenecks through streamlined and faster approval processes and consistent and fair policy enforcement.

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Adams also spoke on Shell’s vision for unlocking Nigeria’s deep-water potential, assuring that the company would continue to leverage its expertise since it pioneered production at the Bonga field in 2005 which achieved one billion barrels export milestone in 2023. Further developments include the FID on the $5-billion Bonga North deep-water project announced last year.

He said SNEPCo’s deep-water achievements have resulted in the payment of taxes and royalties to government, development of indigenous businesses through contract awards and implementation of social investments across the six geopolitical zones in Nigeria.

Adams added: “Shell has powered progress in Nigeria and our vision is to build on our support and help the country to achieve energy security and economic development. We will do this by continuing to take innovative approaches to deep-water development, reducing costs and ensuring better and quicker returns for all stakeholders.”

Shell reported an oil spill yesterday at Ogale, near Port Harcourt, after a saver pit overflowed during flushing operations in the Niger Delta region.

Shell said its spill response team contained the overflow and informed authorities.

It added that arrangements were being made for a regulator-led joint visit to determine the cause and impact of the spill, a Shell spokesperson said in a statement.

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Decades of oil spills have blighted Nigeria’s Niger River Delta region, causing widespread environmental damage that has destroyed the livelihood of millions in the local communities and impacted their health.

Youths and Environmental Advocacy Centre (YEAC-Nigeria) said it had reported the spill to Shell. It said the spill occurred after an underground pit filled with crude started flowing to a pipeline that separates an area of the Ogoni cleanup project, the advocacy group said in a statement.

The signing of the $5 billion Final Investment Decision (FID) for the Bonga North Deep Offshore field by Shell and other investors has been hailed as a testament to Nigeria’s investment-friendly environment under President Bola Tinubu’s administration.

The Democratic Front (TDF) highlighted this development in a statement signed by its Chairman, Danjuma Muhammad, and Secretary, Wale Adedayo. The group noted that the move underscores Nigeria’s continued attractiveness to International Oil Companies (IOCs) for strategic investments.

The statement read in part: “We join President Bola Tinubu in celebrating Shell’s FID on the Bonga North Offshore Field. This investment reflects the success of reforms introduced by the President through Presidential Directives 40, 41, and 42, which have streamlined regulatory approvals, reduced operational costs, and provided competitive fiscal incentives in the oil and gas sector.”

The TDF emphasized the significance of the $5 billion investment, not only for its monetary value but also for the field’s estimated reserves of 350 million barrels of crude oil. This project is expected to boost Nigeria’s oil production and revenue, further cementing its position as Africa’s leading oil producer.

The group also dismissed misconceptions about IOCs exiting Nigeria, pointing out that companies like Shell were making substantial investments in response to the Tinubu administration’s pro-business policies.

“We are thrilled by Shell’s deepwater investment at a time when doubts about Nigeria’s investment climate have been raised. Earlier this year, TotalEnergies also invested $500 million in the Ubeta upstream gas field (OML 58), thanks to the President’s fiscal incentives for foreign direct investments. When operational, this field is projected to produce 350 million standard cubic feet of gas per day, enhancing Nigeria’s profile as a major gas producer”

Read Also: ‘Shell’s divestment to Renaissance in defiance of court’

The Bonga deepwater field, located in OML 118 at a depth exceeding 1,000 meters, was discovered in 1996. According to TDF, the $5 billion investment is the largest in the field’s history and demonstrates the success of President Tinubu’s pro-business governance approach.

“This extraordinary show of confidence in Nigeria’s investment ecosystem validates the administration’s reforms in reducing business risks and removing investment bottlenecks”, the statement added.

TDF expressed optimism that more IOCs would take advantage of the Tinubu administration’s fiscal incentives to invest in Nigeria’s oil and gas sector, driving further economic growth.

Nigeria’s oil minister has finally approved Shell Plc’s $2.4 billion in assets sale to Renaissance Group, Renaissance has revealed. The greenlight comes just two months after Africa’s biggest crude producer declined to approve the sale of Shell’s onshore and shallow-water oil and gas in the Niger Delta region to a consortium of local companies.

The rejection marked a setback for Shell, which has sought to exit the West African oil sector that’s currently plagued by significant oil spills and theft. The Nigerian assets hold a combined estimated volume of 6.73B barrels of oil and condensate and 56.27T cf of associated and non-associated gas.

The Nigerian government approved a similar sale of Exxon Mobil’s onshore oil and gas assets to a Nigerian energy supplier. Last year, Norwegian oil and gas giant Equinor ASA finalized the sale of Equinor Nigeria Energy Company (ENEC) to local firm, Chappal Energy.

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Shell’s approval comes days after the company announced it has taken a final investment decision on its long-delayed Bonga North deepwater project off the coast of Nigeria, the country’s first major deepwater development to move ahead in several years. According to Shell,  Bonga North will be a subsea tie-back to the Bonga floating production storage and offloading facility, which it operates with a 55per cent interest. Shell’s partners in Bonga North are Exxon Mobil-owned Esso Exploration & Production with a 20per cent stake, as well as TotalEnergies and Nigerian Agip Exploration with each owning 12.5 per cent.

With an estimated recoverable resource volume of more than 300M boe, Bonga North is expected to reach peak production of 110K bbl/day, with first oil expected by the end of the decade. The project involves drilling 16 wells – 8 production wells and 8 water-injection wells – installation of new subsea hardware tied back to the FPSO and modifications to the existing Bonga Main FPSO.