The Federal Government of Nigeria has officially approved the sale of Shell Petroleum Development Company's (SPDC) onshore assets to Renaissance Africa Energy Company Limited for a substantial $2.4 billion.
This decision marks a pivotal moment in Nigeria's energy sector, as it transitions towards greater local involvement in oil and gas operations.
The approval, announced by Renaissance in a statement on Wednesday, was reportedly granted by the Minister of State for Petroleum Resources, Heineken Lokpobiri.
"This approval marks a significant step forward from the announcement of the sale and purchase agreements in January," Renaissance stated.
Initially, the transaction faced hurdles when the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) blocked the deal in October. NUPRC's CEO, Gbenga Komolafe, cited that the agreement "could not scale the regulatory test" due to ongoing lawsuits and allegations against Shell concerning human rights abuses and environmental degradation in the Niger Delta region.
However, the deal proceeded after Shell committed to addressing these issues, including taking responsibility for oil spills and funding cleanup efforts.
Renaissance Group, a consortium of local oil companies such as ND Western Ltd., Aradel Holdings Plc, Petrolin Group, FIRS Exploration and Petroleum Development Co., and Waltersmith Group, will now manage the acquired assets.
These assets are reported to hold an estimated 6.73 billion barrels of oil and condensate, along with 56.27 trillion cubic feet of associated and non-associated gas.
This strategic move aligns with Nigeria's broader objective to increase its oil production capacity to 2.3 million barrels per day.
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