‘Our divestment is not illegal'
The Shell Petroleum Development Company of Nigeria Ltd (SPDC) has said that its divestment of its equity from its oil blocs is not in any way illegal, neither is the action driven by ulterior motives.
The firm, in a press statement said the "divestment of its equity from some oil blocs in the Niger Delta is compliant with its contractual rights and regulatory frameworks which guide the oil industry in Nigeria".
It also stated that the company rejects any suggestions that its divestment exercise is illegal, non-transparent or done to undermine the interest of any stakeholders.
"The company has re-assured stakeholders including staff and communities that appropriate consideration will continue to be given to their interests, within the scope of the joint operating agreements (JOAs), while all MoUs and other agreements would be respected".
Tony Attah, vice president for Safety, Environment, Sustainable Development and Communications, Shell Sub Saharan Africa said the process is in support of government policy of encouraging the growth of Nigerian companies in the oil and gas sector and will deliver many opportunities.
"The suggestions that the company's actions are driven by ulterior motives and being done secretly and illegally, to the detriment of stakeholders are untrue.
Since we commenced the process last year, we have been open and transparent and have given equal opportunities to all interested buyers. We went through very rigorous regulated processes, often spanning several months, before possibly reaching any agreements which are also subject to requisite government approvals," he said.
SPDC has repeatedly made it clear that the planned divestments do not mean it is leaving Nigeria, but a strategic refocusing of its portfolio, including investment and necessary asset sales aimed at strengthening "our long-term position in the country."
The firm said consultations are continuing and that it will share information as necessary. Shell, along with foreign oil major partners Total and Eni have agreed to sell their share in four onshore oil blocs which Shell operates in the onshore wetlands in the Niger Delta. However, NNPC, the nation's oil firm which owns the majority stake in the blocs has said its subsidiary would take over from Shell as operator of the fields once the deals are completed.
Its argument include that it has 55 percent of the said blocs and that the decision was taken that it would hold operatorship of those blocs on behalf of the federal government for the safety and security of our assets and the security of the economy as a whole. Shell, Total and Eni are selling their combined 45 percent of the blocs OML 30, 34, 40 and 42, while NNPC holds the remaining 55 percent.
Shell has said it views Nigeria as a key part of its business and the sale of these assets, which make up a small portion of its operations in the country, is not the beginning of a wider departure from Africa's most populous nation. Shell has already sold part of offshore assets in January 2010.
Industry watchers say Shell's sale of assets in Nigeria is part of a wider plan to divest $5 billion of assets in Africa this year. It is believed that the actual potential will be a lot clearer once more detailed technical data are publicly available.
Experts say most of the assets oil firms are trying to divest are either shut-in or produce at restricted rates. They also believe that the potential PIB and the already passed Local Content Bill might have had some impact on their decision. Especially the fact that the early version of the PIB was proposing that the majors may be required to relinquish some of the undeveloped fields.
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