Shell Champions Accelerated Gas Development in Nigeria, Citing Infrastructure & Stability
Shell, a venerable participant in Nigeria's energy landscape, is vigorously advocating for the expedited development of the nation's vast gas resources. This commitment aligns seamlessly with both Nigeria's ambitious "Decade of Gas" initiative and Shell's global strategy to transition towards a lower-carbon energy future.
Shell Nigeria Gas (SNG), the company's dedicated gas distribution arm, consistently underscores the critical need for substantial investment across the entire gas value chain. This encompasses the expansion of vital pipelines to connect gas sources with demand centers, the establishment of sophisticated gas processing plants, and the robust development of comprehensive gas distribution networks to serve industrial, commercial, and residential consumers. SNG currently operates approximately 150 kilometers of such networks, supplying over 140 industrial and commercial clients primarily across Ogun, Abia, and Rivers states.
Further cementing its commitment, SNG is actively developing new gas distribution networks in Oyo and Bayelsa States, while also expanding its reach to accommodate more industries in Ogun, Rivers, and Abia. A prime example is the Oyo State-Shell Nigeria Gas Infrastructure Development and Distribution project, initiated in 2020, which secured a final investment agreement of approximately $100 million in May 2024, with first gas distribution anticipated within the next 18 months.
Ralph Gbobo, Managing Director of SNG, has repeatedly stressed that a stable and transparent regulatory and fiscal regime is paramount for fostering a predictable and secure operating environment that truly inspires investor confidence. This stability, achieved through consistent policy implementation (such as the Petroleum Industry Act and the Network Code), is crucial for attracting the significant capital required for large-scale gas projects. Recent government efforts, notably shortening approval timelines for oil and gas contracts from 36 months to just 6 months, are viewed as a positive stride, having already unlocked over $16 billion in new investments since 2023.
Beyond infrastructure and regulation, Shell also champions the adoption of advanced technologies to bolster the efficiency, sustainability, and growth of the domestic gas sector. This includes leveraging real-time data analytics, remote monitoring, autonomous operations, smart metering, and predictive analytics systems. Furthermore, the company emphasizes the crucial role of partnerships and collaboration across government, regulators, investors, and communities to pool investment capital, facilitate knowledge transfer, cultivate expertise, and significantly enhance Nigeria's domestic gas utilization.
Shell's broader commitment to Nigeria's energy future extends beyond gas. The company recently completed the sale of The Shell Petroleum Development Company of Nigeria Limited (SPDC) to Renaissance, signaling a strategic shift towards focusing future disciplined investment in its Deepwater and Integrated Gas positions within the country. This includes Shell Nigeria Exploration and Production Company Ltd (SNEPCo)'s active involvement in expanding its stake in the Bonga field and the recent Final Investment Decision (FID) for the $5 billion Bonga North development. This deepwater oil and gas project, designed to tie back to the existing FPSO Bonga and involve 16 new wells, is projected to sustain oil and gas production at the facility, with first oil expected by the decade's end.
These initiatives align with Shell's refreshed "Powering Progress" strategy, which aims to accelerate a "purposeful and profitable" transition to lower-carbon businesses by the early 2030s. This strategic direction is in harmony with Nigeria's ambitious target of achieving net-zero emissions from fossil fuels by 2050, by optimizing investments in hydrocarbon energy sources and exploring rapid renewable opportunities.
