FG Approves Shell’s $2.4bn Onshore Asset Sale to Renaissance

According to reports, the sale of Shell Petroleum Development Company’s (SPDC) onshore assets to Renaissance Africa Energy Company Limited, a regional oil and gas consortium, has been approved by the Federal Government of Nigeria.

According to Reuters, Renaissance made the announcement in a statement on Wednesday.

“This approval marks a significant step forward from the announcement of the sale and purchase agreements in January,” Renaissance said in the statement.
According to reports, Heineken Lokpobiri, the Minister of State for Petroleum Resources, granted the approval.

Africa Report claims that Shell’s $5 billion investment in the Bonga North project played a key role in convincing the government to authorize the sale of the onshore asset, which had been originally agreed to be worth $1.3 billion.

Background
Although SPDC and the Renaissance had struck a deal in January, it was claimed that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) vetoed the sale in October.

According to reports, the properties include 56.27 trillion cubic feet of related and non-associated gas and an estimated 6.73 billion barrels of oil and condensate.
The commission rejected the agreement because it “could not scale (the) regulatory test,” according to Gbenga Komolafe, CEO of NUPRC.
Concerns have also been raised by the various lawsuits and accusations that Shell Nigeria is facing related to environmental degradation and violations of human rights in the Niger Delta.
According to NUPRC, the sale will only be approved if Shell accepts accountability for oil spills and commits to paying for Niger Delta cleaning.
Things you should be aware of
A local group, Renaissance Group, has agreed to purchase Shell Plc’s onshore oil assets in Nigeria.

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ND Western Ltd., Aradel Holdings Plc, Petrolin Group, FIRS Exploration and Petroleum Development Co., and Waltersmith Group are among the regional oil businesses that make up Renaissance Group.
In October, the upstream regulatory body, NUPRC, blocked the agreement.
According to NUPRC, Shell should take accountability for oil spills that have caused harm to people and the environment and pledge to clean up.
Shell, Total Energy, and Eni are among the oil giants that are abandoning their onshore activities and selling off their offshore businesses.
The reason behind this is that they are avoiding addressing the local communities that are impacted by environmental damages and oil spills. These businesses also had to deal with problems like pipeline vandalism and oil theft.