The Federal Government has approved Shell’s $2.4 billion onshore asset sale to Renaissance Group, a move expected to increase Nigeria’s oil production by 143,000 barrels per day (bpd). This was revealed by the Director-General of the Budget Office, Mr. Taminu Yakubu, during a live interview on Arise Television on Wednesday.
Renaissance Group, a consortium of local oil companies, confirmed the approval in a statement released late Wednesday night. According to the group, “This approval marks a significant step forward from the announcement of the sale and purchase agreements in January.”
The Renaissance consortium comprises ND Western Ltd., Aradel Holdings Plc, Petrolin Group, FIRS Exploration and Petroleum Development Co., and Waltersmith Group.
Yakubu highlighted that the Federal Government is committed to reducing the cost of oil production to attract further investments in the sector. He also noted that other divestments involving indigenous oil firms would play a critical role in shoring up Nigeria’s production capacity.
He expressed optimism that Nigeria would meet its oil production target of 2.06 million bpd, as projected in the 2025 budget.
Shell announced on January 16 its decision to exit Nigeria’s onshore and shallow water operations, opting to focus on deep offshore fields with higher potential returns. The sale was agreed upon with Renaissance, a consortium of five predominantly local companies.
However, in October 2024, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) rejected the deal, stating that it “could not scale (the) regulatory test.” Industry observers speculated that the rejection was due to concerns about Renaissance’s capacity to manage the assets.
The assets in question hold an estimated 6.73 billion barrels of oil and condensate, along with 56.27 trillion cubic feet of gas. NUPRC has also raised concerns over unresolved environmental issues linked to Shell’s operations in the Niger Delta, insisting that Shell must address oil spills and fund cleanup efforts before receiving approval for the sale.
In a related development, Seplat Energy Plc recently completed its acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil.
According to Seplat, the transaction is “transformative,” doubling production capacity and positioning the company for growth and profitability while significantly contributing to Nigeria’s energy future.
The acquisition adds substantial assets to Seplat’s portfolio, including equity in 11 oil blocks, 48 producing fields, five gas processing facilities, and three export terminals. The deal also includes a 40% operated interest in OMLs 67, 68, 70, and 104; a 40% stake in the Qua Iboe export terminal; and a 51% operated interest in the Bonny River Terminal NGL recovery plant.
Additionally, approximately 1,000 staff and 500 contractors are transitioning to the Seplat Group, solidifying its position as Nigeria’s leading independent energy company.