British energy giant Shell has signed an agreement to sell its full interest in Shell Nigeria Gas Group to indigenous energy firm Vaaris Energy Limited, marking its planned exit from Nigeria’s domestic gas distribution business.
Shell announced the deal in a statement on Tuesday, noting the transaction forms part of the strategy to simplify its portfolio and concentrate investments on areas of competitive strength.
“Shell Nigeria Gas has served industrial and commercial customers in Nigeria for more than 25 years, supported by the commitment and expertise of its people,” Elohor Aiboni, Shell’s country chair in Nigeria, said.
“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.”
The companies did not disclose the financial terms of the transaction.
The deal is subject to regulatory conditions and approvals, and covers Shell Nigeria Gas Holding B.V., established in 2019, which holds all but one share in Shell Nigeria Gas Limited.
Until the transaction is completed, Shell Nigeria Gas Group will remain part of Shell and continue to serve its customers, while operating as usual.
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Established in 1998, Shell Nigeria Gas supplies natural gas to industrial and commercial customers and runs about 170 kilometres of pipeline infrastructure across Ogun, Abia and Rivers states.
The company serves more than 130 connected customers, but is not involved in upstream gas production, liquefied natural gas, LNG, operations or international gas trading.
Vaaris Energy is a privately held Nigerian energy company with interests across the oil and gas value chain.
The divestment reflects Shell’s broader efforts to streamline its global portfolio under Chief Executive Officer Wael Sawan, and focus on businesses and projects offering competitive returns.
In Nigeria, the company said it would continue to prioritise deepwater operations and integrated gas, including its interest in Nigeria LNG.
Last week, Shell reportedly raised its forecast for third-quarter integrated gas production to between 740,000 and 780,000 barrels of oil equivalent per day, up from its previous estimate of 570,000 to 630,000 barrels of oil equivalent per day.
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