Shell Plans To Sell Nigerian Oil Assets

Published: 21-Dec-2009

In an effort to reduce its reliance on Nigeria, Royal Dutch Shell (Shell) has revealed its intentions to sell Nigerian onshore oil-production assets, which have a market value of approximately GBP3.1 billion. The oil fields are said to have oil reserves of approximately 100 million barrels.

The company plans to sell the assets as the government of Nigeria seeks to make oil reforms. As reported, the government prepares to bring in harsher conditions for foreign operators and give greater control of the oil sector to domestic companies.

The oil fields for sale are in the west of Nigeria and include producing fields and undeveloped blocks. However, Shell will not sell its offshore blocks, since they have more generous royalty terms and are less vulnerable.

Reportedly, Chinese state-controlled oil companies such as Sinopec and China National Offshore Oil Corporation, and Nigerian company Oando have shown their interest be potential buyers for the oil assets. Afren, an oil and gas exploration and production company, could be another possible contender for the assets.

Separately, Shell and its partner Malaysia's state-run Petronas Carigali have signed a preliminary deal with Iraq to develop Majnoon oil field in southern Iraq. The deal requires approval of the Iraqi cabinet.

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