Shell to sell Nigerian gas distribution business to Vaaris Energy

Shell has agreed to sell its entire interest in its Nigerian domestic gas distribution business to local energy firm Vaaris Energy Limited, as the global energy company moves to streamline its portfolio and focus on deepwater and integrated gas operations.

Shell Petroleum B.V. announced the agreement in a statement on Tuesday, saying the transaction would transfer its interest in the Shell Nigeria Gas Group to Vaaris Energy, subject to regulatory approvals and other conditions.

The deal covers Shell Nigeria Gas Holding B.V., established in 2019, which holds all but one of the shares in SNG Limited.

Shell’s Country Chair in Nigeria, Elohor Aiboni, said Shell Nigeria Gas had served industrial and commercial customers in the country for more than 25 years.

“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.

Shell said the business would continue operating as usual and serving its customers until the transaction is completed.

The company explained that the divestment aligns with its strategy to simplify its portfolio and concentrate investment in areas where it has competitive strengths.

Its continued involvement in Nigeria’s deepwater and integrated gas sectors, including its interest in Nigeria LNG, forms part of that strategy.

Established in 1998, Shell Nigeria Gas supplies natural gas to industrial and commercial customers and operates about 170 kilometres of pipeline infrastructure across Ogun, Abia and Rivers states.

The company does not engage in upstream gas production, liquefied natural gas operations or international gas trading.

Vaaris Energy is a Nigerian energy company with interests across the oil and gas value chain and an existing operational presence in the country.

The financial terms of the transaction were not disclosed in the statement.