The Federal Government, through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), has rejected the proposed $1.3 billion sale of onshore oilfields to the Renaissance Group, citing the buyer’s lack of qualification to manage the assets, according to a Reuters report.
Shell, which owns the assets via Shell Petroleum Development Company (SPDC), said it was providing NUPRC with all the required information.
However, NUPRC declined to approve the sale on the grounds the Renaissance consortium could not show it could manage the assets, the report notes.
According to the report, the NUPRC has communicated its decision to all the parties.
“Shell and the government are in ongoing communication as part of the approval process for the sale of SPDC. SPDC will continue to provide the regulator with all information needed to complete the approval process,” a Shell spokesperson told Reuters.
Naijaonpoint previously reported in January that Shell Plc has reached an agreement to sell its Nigerian onshore oil assets to a local consortium for over $1.3 billion, pending government approval.
Meanwhile, residents from host communities have filed a N500 billion claim against Shell Petroleum Development Company, alleging that the company violated an existing “Mareva” injunction and seeking to block the sale of its onshore assets.
International oil companies (IOCs) are scaling back operations in Nigeria due to a combination of factors that have undermined the profitability and sustainability of their ventures, with oil thefts in the Niger Delta being a primary concern.
Companies like Shell Plc and ExxonMobil have opted for divestment strategies to cut costs and reallocate investment in deep water operations where there are fewer risks and threats of hostile business environments.