Shell has agreed to transfer its domestic gas distribution business in Nigeria to indigenous energy firm Vaaris Energy Limited, ending its direct involvement in the segment after more than 25 years.
The transaction, announced by Shell Petroleum B.V. on Tuesday, covers the international energy company's entire interest in Shell Nigeria Gas Group, which supplies natural gas to industrial and commercial customers.
The deal is subject to regulatory conditions and approvals. Its financial terms were not disclosed.
Shell's decision reflects its strategy to streamline its portfolio and concentrate investments on deepwater operations and integrated gas projects, including its interest in Nigeria LNG Limited.
Elohor Aiboni, Shell's country chair in Nigeria, said the gas distribution business had served industrial and commercial customers for more than 25 years, backed by the commitment and expertise of its workforce.
“We believe this agreement provides a much stronger platform for the business’ next chapter under new ownership. Shell continues to focus on strategic Deepwater and Integrated Gas positions in Nigeria,” Aiboni said.
Established in 1998, Shell Nigeria Gas supplies natural gas to businesses through about 170 kilometres of pipeline infrastructure across Ogun, Abia and Rivers states.
The company operates in domestic gas distribution and is not involved in upstream gas production, liquefied natural gas or international gas trading.
The transaction covers Shell Nigeria Gas Holding B.V., established in 2019, which holds all but one of the shares in Shell Nigeria Gas Limited.
Shell said the business would continue operating as usual and serving its customers until the transaction was completed.
Vaaris Energy, the prospective buyer, is a Nigerian energy company with interests across the oil and gas value chain and an existing operational presence in the country.
The acquisition will transfer the gas distribution business to local ownership as Shell continues to prioritise areas where it believes it has competitive strengths in Nigeria's energy industry.
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