Shell Links Onshore Asset Sale to $5bn Deepwater Investment in Nigeria

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Shell has linked the approval of its controversial onshore asset sale in the Niger Delta to a $5bn investment in deepwater oil projects off the coast of Nigeria. The Anglo-Dutch company's decision to invest in the Bonga North project comes after the Nigerian government approved Shell's $1.3bn sale of onshore oil assets to Renaissance Africa Energy. The deal faced significant obstacles, including concerns over environmental damage. Shell emphasized its desire to continue investing in Nigeria's deepwater oil and LNG sectors, but also highlighted the need to exit its onshore assets due to their long history of environmental issues and community tensions.

Shell made the approval of the sale of its controversial assets in the Niger Delta a condition of fresh investments off the coast of Nigeria, according to people familiar with the deals. The Anglo-Dutch company said on Monday it had made a final decision to invest a reported $5bn in the Bonga North project, a deepwater field 130 kilometres off the west African coast. The investment is a boost for President Bola Tinubu’s drive to attract much-needed capital into the Nigerian economy.

Renaissance, a mostly local consortium, is acquiring the Shell Petroleum Development Company of Nigeria , Shell’s onshore oil production unit in Africa’s largest producer. SPDC is the most important oil company in the country and part of a joint venture which produces about 30 per cent of Nigeria’s oil and gas. Shell owns 30 per cent of the JV, alongside 55 per cent held by the state-owned Nigerian National Petroleum Company.

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