Shell Exits Nigeria's Onshore Oil to Focus on Offshore Projects
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Shell plc SHEL has completed the sale of its Nigerian onshore subsidiary, Shell Petroleum Development Company of Nigeria (SPDC), to Renaissance, a Nigerian-led consortium. This $1.3 billion transaction, previously held back by regulators, is part of Shell’s broader strategy to streamline its operations by exiting onshore oil production in the Niger Delta and focusing on offshore deepwater and integrated gas projects.The SPDC joint venture includes 15 onshore and three shallow-water oil mining leases, which have long faced environmental and operational challenges such as oil spills and community disputes. By selling its stake, Shell aims to resolve these issues while reinforcing its commitment to deepwater projects.An Insight Into the SPDC Joint VentureThe SPDC Joint Venture is held jointly by Nigerian National Petroleum Co. Ltd. owning a 55% stake, TotalEnergies SE TTE owning a 10% stake and Eni S.p.A. E holding the remaining 5% stake. The 30% stake previously held by Shell, currently carrying a Zacks Rank #3 (Hold),via SPDC, has now been sold to Renaissance.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.TotalEnergies has entered into a deal to divest this to Chappal Energies Mauritius Ltd. for $860 million and Eni SpA sold its Nigerian subsidiary, Nigerian Agip Oil Co. Ltd. (NAOC), to a local player, Oando PLC, for nearly $800 million last year but has decided to retain its SPDC JV stake.Implications for Nigeria’s Oil IndustryThis divestment reflects a broader industry trend, with international oil majors like TotalEnergies and Eni shifting their focus offshore. Renaissance’s acquisition signals a growing role for indigenous companies in Nigeria’s energy sector, empowering local firms to take charge of onshore operations.However, the transition raises questions about the new owner’s ability to manage the assets, especially regarding environmental responsibilities. The Nigerian government has emphasized the need for technical and financial capacity to sustain production and meet regulatory obligations.Shell’s Future in Nigeria: Deepwater and LNG InvestmentsDespite leaving the onshore sector, Shell remains deeply invested in Nigeria’s offshore oil and gas industry. The company recently announced an FID in the Bonga North project, highlighting its long-term commitment to deepwater exploration and LNG expansion.This move positions Nigeria as a key player in the global energy market while addressing sustainability concerns. As international firms pivot offshore, the success of local operators in managing onshore resources will shape the future of Nigeria’s oil industry.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Eni SpA (E): Free Stock Analysis Report TotalEnergies SE Sponsored ADR (TTE): Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks
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