October 16, 2024

Nigeria’s oil regulator has rejected Shell’s proposed $1.3 billion sale of its onshore oilfields to Renaissance group because the buyer is not qualified to manage the assets, according to ThisDay newspaper report on Wednesday.

Shell on Jan. 16 announced its exit from Nigeria’s onshore and shallow water operations after agreeing to sell the business to a consortium of five mostly local companies, opting to focus future investments in the more lucrative and less troubled deep offshore fields.

Nigerian Upstream Petroleum Regulatory Commission (NUPRC) declined to approve the sale because the Renaissance consortium could not show it could manage the assets.

The companies that make up the group have been unable to operate at least 50% of all existing assets under their control, ThisDay reports, citing unnamed persons familiar with the process.

According to the report, the NUPRC has communicated its decision to all the parties.

The regulator, Shell and Renaissance didn’t immediately respond to requests for comments.

Shell’s exit from Nigeria’s onshore operations is part of a broader retreat by the oil majors as they focus on newer, more profitable operations.

Exxon Mobil, Italy’s Eni and TotalEnergies have all struck deals to sell assets in the country in recent years.
REUTERS