The Federal Government of Nigeria has approved the sale of onshore assets owned by Shell Petroleum Development Company (SPDC) to Renaissance Africa Energy Company Limited, a local oil and gas consortium. The landmark decision was announced by Renaissance in a statement on Wednesday.
The approval, granted by Minister of State for Petroleum Resources, Heineken Lokpobiri, marks a significant milestone following the announcement of the sale and purchase agreements in January. According to Renaissance, the development signals a breakthrough after months of regulatory hurdles.
A pivotal factor influencing the government’s decision was Shell’s $5 billion investment in the Bonga North project. This major commitment reportedly persuaded the authorities to greenlight the $1.3 billion sale.
Despite the agreement between SPDC and Renaissance earlier this year, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) had blocked the deal in October. NUPRC cited concerns over regulatory compliance, with CEO Gbenga Komolafe stating that the transaction “could not scale (the) regulatory test.”
Additionally, Shell Nigeria has faced mounting lawsuits and allegations of human rights abuses and environmental degradation in the Niger Delta region. NUPRC stipulated that any approval would require Shell to accept liability for oil spills and fund cleanup efforts in the affected areas.
The onshore assets being sold are reportedly rich in resources, with an estimated 6.73 billion barrels of oil and condensate, alongside 56.27 trillion cubic feet of associated and non-associated gas. The sale is expected to enhance local participation in Nigeria’s oil and gas sector while addressing long-standing environmental and regulatory concerns.
This approval underscores the Nigerian government’s efforts to balance economic development, environmental responsibility, and local empowerment in its energy sector.
