Shell has paused Nigerian Onshore Divestment pending the outcome of the court case.
After announcing a major divestment from its Nigerian onshore services in 2021, Shell PLC has announced a pause, citing a Supreme Court suit over an oil leak filed by a community in Bayelsa State.
This was disclosed in a statement by Osagie Okunbor, managing director of SPDC and chairman of Shell Companies in Nigeria, on Thursday, according to Bloomberg.
Shell Petroleum Development Company of Nigeria Ltd, was issued an order by Nigeria’s Supreme Court which is considering the company’s appeal of an oil-spill penalty of nearly $2 billion.
What they are saying
The Nigerian Supreme Court ordered Shell to maintain status quo until October, as Nairametrics reported last month that Shell Petroleum Development Company (SPDC) asked the Federal High Court in Yenagoa to stay proceeding in the N700 billion oil spill compensation suit filed by members of Aghoro I Community in Bayelsa.
“We have a strong belief in the merits of our case, which we are vigorously defending,” Okunbor said. “SPDC will continue to comply with the Supreme Court’s order to maintain the status quo.”
Shell said it welcomed the Supreme Court’s decision to hear SPDC’s appeal and that it would not progress with the divestment of its interest in the venture until the outcome of the appeal.
“It remains Shell’s strategic intent to divest its shareholding in SPDC, while continuing to invest in Shell’s deepwater and gas positions in Nigeria,” it stated.
What you should know
- Recall that last year July that Royal Dutch Shell launched a major divestment of its Nigerian assets following the issuance of sale documents with the expressions of interest (EOIs)
- Shell had engaged Standard Chartered to sell its Shell Petroleum Development Company of Nigeria Limited (SPDC) subsidiary.
- SPDC operates the company’s shallow-water and onshore asset interests with its 30% stake in the SPDC joint venture, which supplies around 10% of Nigeria’s gas demand.
- Last month, Heirs Oil and Gas Ltd. and ND Western Ltd. said they are vying for Shell’s 30% stake in the joint venture, which manages assets in the Niger Delta and offshore areas
- Nairametrics recently reported that the Shell Petroleum Development Company (SPDC) asked the Federal High Court in Yenagoa to stay proceeding in the N700 billion oil spill compensation suit filed by members of Aghoro I Community in Bayelsa, people of Aghoro community had sued Shell Petroleum Development Company (SPDC) over the May 17, 2018 oil leak from the oil firm’s Trans Ramos Pipeline.