Nigerian Govt Clears Way for Shell Onshore Asset Sale After Years of Stalemate

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Despite past reservations, the Nigerian government has given its green light to Royal Dutch Shell’s long-anticipated sale of its onshore oil assets in the country, according to a statement released Thursday by the Ministry of Petroleum Resources.

Nneamaka Okafor, special adviser to Minister of State for Petroleum Resources (Oil) Heineken Lokpobiri, confirmed the government’s support for the deal struck on Monday between Shell and a consortium of five local companies.

In its statement on Thursday, Mr Lokpobiri affirmed the Nigerian government’s commitment to fostering a business-friendly environment in the country’s oil and gas sector.

Speaking on the sidelines of the World Economic Forum in Davos, Switzerland, the minister addressed Shell’s decision to sell its onshore assets to a consortium of five Nigerian companies.

Mr Lokpobiri emphasised that the Nigerian government will not impede legitimate business transactions in the oil and gas sector.

“On the part of the government, once we get the necessary documents, we will not waste time to give the necessary considerations and consent,” the statement quoted the minister as saying.

The move marks a significant shift in stance, considering the years of roadblocks Shell faced in its attempts to offload the troubled assets.

The sale, worth a reported $2.4 billion, includes 15 onshore mining leases and three shallow-water operations, signaling Shell’s strategic shift towards deeper offshore fields in the Niger Delta. While details of the government’s approval and potential conditions remain unclear, Okafor’s statement emphasizes the government’s commitment to “fostering a business-friendly environment” in the oil and gas sector.

This development holds implications for both Shell and Nigeria’s energy landscape. For Shell, it represents a step toward streamlining its portfolio and mitigating security risks associated with onshore operations. For Nigeria, it presents an opportunity to diversify its oil sector with the entry of new players and potentially drive investment in exploration and development.

However, concerns remain regarding the environmental impact of decades of Shell’s operations and the potential for local communities to benefit from the sale. As the deal moves forward, stakeholders will be closely watching how the government ensures transparency and accountability throughout the process.