This may not be the best of times for Nigeria, being embattled from all round, threatening the major source of her foreign earnings.
This is aside from booming theft of crude, vandalistion of pipelines and mounting debts used to service consumption.
More worrisome is the gradual and systematic divestment by some major international oil companies (IOCs).
The latest is the planned divestment of TotalEnergies of some of its assets in Nigeria, a development, like others that has continued to reinforce waning confidence in the economy.
Stakeholders in the oil and gas industry believe that government must step up its action in the area of security and policy summadsult.
As at today, the country is being confronted with a huge loss of crude oil through theft and vandalistion of the industry’s infrastructure and community disruptions.
These practices have been on for a long time with the government allegedly not having or demonstrating the needed political will to tackle the issues.
Specifically, industry on Thursday was jolted again as TotalEnergies put the country on alert that it plans to divest 10 percent of it assets.
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This is coming barely three months after ExxonMobil decided to sell its interest in Mobil Producing Nigeria Unlimited to Seplat Energy plc in a yet to be consummated deal.
France’s supermajor TotalEnergies plans to sell its minority stake in an onshore oil-producing joint venture in Nigeria in what will be the latest divestment of Nigerian oil assets by an international major. Bang
TotalEnergies will put up for sale its 10-percent interest in a company operating 20 licenses onshore Nigeria and in shallow waters, the French firm’s chief executive Patrick Pouyanné said at an earnings conference call on Thursday.
“Disruption of local communities are sources of great concerns,” Pouyanné said on the call, as carried by Bloomberg.
The licenses are being operated by another supermajor, Shell, which is also looking to divest Nigerian assets. The sale of Shell’s stake in the joint venture attracted bids from four Nigeria-based companies, Bloomberg reported early this year, quoting sources with knowledge of the sales process.
As early as in the spring of 2021, Shell’s chief executive Ben van Beurden said the supermajor does not see its upstream oil operations in Nigeria as compatible with its strategy to become a net-zero energy business.
“We cannot solve community problems in the Niger Delta,” said the top executive at Shell, which has encountered numerous problems in Nigeria’s onshore in recent years, including oil theft and pipeline sabotage, as well as lawsuits brought up by local communities over oil spills.
In February 2021, The Hague Court of Appeal ordered Shell to compensate Nigerian farmers for two oil spills in the country 13 years ago, in the first lawsuit in which a company had been held liable in the Netherlands for its actions abroad. The ruling of the Dutch court set a precedent for future lawsuits brought against oil firms in the countries where they are based, instead of the countries where oil spills or oil pollution has allegedly taken place.
Shell and TotalEnergies are not the only companies divesting from Nigeria’s upstream. ExxonMobil agreed earlier this year to sell its equity interest in Mobil Producing Nigeria Unlimited to Nigerian company Seplat Energy. The sale includes ExxonMobil’s shallow-water affiliate, while the U.S. supermajor will retain its deepwater assets.
