Shell is in talks with the Nigerian government after concluding that its onshore oil position in the Niger Delta is no longer worth the risk, chief executive Ben van Beurden said today.
Its local unit Shell Petroleum Development Company of Nigeria (SPDC) has divested around 50pc of its onshore Nigerian portfolio over the past 10 years as it grapples with long-running and persistent challenges of crude theft and pipeline sabotage, which it blames for oil spills. Shell said earlier this year that it would reconsider its position in the region.
"When law and order breaks down, when sabotage and theft is rife where you try to operate, no amount of effort that we put in can actually try to compensate for that," van Beurden said today. "At some point in time we also have to conclude that this is an exposure that does not fit with our risk appetite anymore. We have drawn that conclusion, and we are now talking to the Nigerian government on the way forward".
Van Beurden did not explicitly say that Shell would exit onshore Nigeria completely or give a timeline for any potential asset sales.
