Jump to navigation

Nigeria

Pay to get out, regulator tells oil and gas giants

As multinationals retreat from the continent, Tinubu seems keen to offer incentives to domestic firms to take over their assets

Nigeria's state petroleum authority has made an unusual offer to the oil and gas giants who now want to sell up their assets in Nigeria: quick approval for the divestment plans will be conditional on the majors taking responsibility for the costs of environmental damage.

Following a meeting with a group of companies including Exxon Mobil and Shell in Abuja last week, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) chief Gbenga Komolafe said that approval could be granted in June if the companies commit to cleaning up spills and compensating communities rather than wait for authorities to apportion blame.

The alternative, he warned, is to wait for the NUPRC to identify and assign all liabilities, potentially delaying the final approval until August.

Nigeria is witnessing an exodus of oil majors from their onshore investments, led by Shell, Total, Eni and Norway's Equinor (AC Vol 65 No 3, Shell leads oil majors' exit from the Niger Delta). President Bola Tinubu's government appears keen to offer incentives to domestic oil and gas firms to take over their assets.

Shell, the largest major player in Nigeria, announced plans earlier this year to sell its Nigerian subsidiary to Renaissance, a consortium of five mainly local firms, as part of a transition away from fossil fuels, it says.

However, environmental and human rights activists are urging the Nigerian government to withhold approval of the divestment plans, unless the oil giant does more to tackle pollution in the region caused by its activities. Last year, a report commissioned by Bayelsa State in the Niger Delta, estimated that US$12 billion would be needed to pay for over a decade of damage caused by Shell and Eni (AC Vol 64 No 11, Bayelsa commission reports).



Related Articles

Shell leads oil majors' exit from the Niger Delta

Companies accused of under-investment – arrangements on financing and liability for pollution may be contested

When the British oil major Shell announced on 16 January that it would be selling its interests in 18 oil licences in shallow water and onshore Niger Delta...


Bayelsa commission reports

The Bayelsa State Oil and Environmental Commission (BSOEC) launched its much-anticipated report on 60 years' worth of oil pollution in the state, where local companies now produce about...


Clean-up or cover-up?

Links between Big Oil and politicians are blocking a multimillion-dollar environmental rescue plan for the Delta

The UN-mandated clean-up of oil-polluted Ogoniland is becoming mired in allegations of pay-outs to politicians to rig elections in Rivers State. Violence and vote-rigging over two successive weekends...


Generals on the run

The army is in retreat before the Islamist insurgents. Corruption, indifference and a lack of resources are blamed

Speaking to journalists on 7 February, the army's theatre commander for north-eastern Nigeria, Major-General Olusegun Adeniyi, repeated the government's frequent assertion that Boko Haram has been defeated. Yet...


Ekiti, the shape of things to come

After a year on the defensive, the governing PDP has launched a determined fightback against opposition strongholds in the south-west

The victory of Ayo Fayose, candidate of the People's Democratic Party (PDP), in the governorship elections in Ekiti State on 21 June held some harsh lessons for modernising...

READ FOR FREE