Shell Plc has signed an agreement to sell its entire interest in Shell Nigeria Gas (SNG) Group, which operates a domestic gas distribution business in Nigeria, to Nigerian energy company Vaaris Energy.
The oil major announced the transaction on Tuesday, saying the deal remains subject to regulatory conditions and approvals. The financial terms were not disclosed.
The sale covers Shell Nigeria Gas Holding B.V., established in 2019, which holds all but one of the shares in SNG Limited.
The transaction forms part of Shell Chief Executive Officer Wael Sawan’s strategy to simplify the company’s portfolio and prioritise investments expected to deliver stronger returns, particularly in oil and gas.
Shell Nigeria Gas serves industrial customers
Commenting on the agreement, Shell’s Country Chair in Nigeria, Elohor Aiboni, said SNG had served industrial and commercial customers in the country for more than 25 years, supported by the commitment and expertise of its workforce.
- “We believe this agreement provides a much stronger platform for the business’ next chapter under new ownership. Shell continues to focus on strategic Deepwater and Integrated Gas positions in Nigeria,” she said.
Shell said SNG Group would continue operating as usual and serving its customers until the transaction is completed.
Established in 1998, SNG supplies natural gas to industrial and commercial customers and operates approximately 170 kilometres of pipeline infrastructure across Ogun, Abia, and Rivers states.
Vaaris Energy is a privately held Nigerian energy company with interests across the oil and gas value chain and an existing operational presence in the country.
Shell adjusts global gas production outlook
The transaction comes as Shell continues to manage its global energy portfolio and production outlook.
Last week, the company raised its third-quarter integrated gas production forecast to between 740,000 and 780,000 barrels of oil equivalent per day (boepd), up from its previous estimate of 570,000 to 630,000 boepd.
In Nigeria, Shell has continued to maintain a strategic presence in deepwater oil and integrated gas operations, even as it divests selected assets.
Tinubu-backed incentives target new Shell investment
The proposed sale comes months after President Bola Tinubu approved the gazetting of targeted, investment-linked incentives to support Shell’s proposed Bonga South-West deep-offshore oil project.
The incentives are intended to accelerate a final investment decision (FID) on the project, which the Federal Government considers important for boosting oil production, creating jobs, and increasing foreign exchange earnings.
Tinubu said the incentives were designed to attract new investments while protecting government revenue and securing long-term economic benefits.
He emphasised that the measures were not broad-based concessions but targeted provisions intended to encourage fresh capital commitments and higher output from the energy sector.