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Shell Companies in Nigeria (SCiN) are major contributors to the economy, not only through the energy they produce and the revenues they generate for the country, but also via their supply chains, local content and social investment.
Today, Nigeria is one of the biggest oil and gas producers in Sub-Saharan Africa and has the continent’s largest natural gas reserves. Population estimates range from 160-175 million and the United Nations predicts that Nigeria could have the world’s fourth largest population by 2030.
Therefore it is an economic and political imperative for Nigeria to make the most of its energy resources. SCiN work in partnership with the Nigerian government, local and international companies, investors, contractors and communities in meeting this challenge.
ENERGY AND REVENUE
In 2015 Shell-operated ventures in Nigeria produced an average of 688,000 barrels of oil equivalent per day (boe/d), with 496,000 boe/d from the Shell Petroleum Development Company of Nigeria Limited operated Joint Venture (SPDC JV) and 192,000 barrels of oil per day from the Shell Nigeria Exploration and Production Company Limited (SNEPCo).
Shell Nigeria Gas Limited (SNG) supplies natural gas to 87 industrial customers and the SPDC JV is the major supplier of gas to Nigeria LNG.
The SPDC JV Afam VI power plant, which has a 650 megawatt generating capability, supplied approximately 14% of the nation’s grid-connected electricity in 2015 and has delivered 20 million Megawatt-hour (MWh) of electricity into the Nigerian grid between its inauguration in 2008 and June 2015.
In 2015 the United Nations Framework Convention on Climate Change (UNFCCC) issued approximately 542,000 Certified Emission Reductions (CER) credits to the Afam VI power plant. This makes the plant the first energy efficiency project on power generation registered from Nigeria and also the first UN registered Clean Development Mechanism (CDM) initiative in the Shell Group.
Nigeria depends on the oil and gas industry for approximately 90% of export income and 75% of overall government revenue. The economic contribution from SPDC JV partners to the Nigerian government between 2011-2015 was $42 billion. The Shell share of royalties and corporate taxes paid to the Nigerian government in 2015 was approximatively $1.1 billion.
SCiN make a major contribution to developing the country’s human capital and contracting capacity. Ninety- three percent of SCiN contracts were awarded to Nigerian companies in 2015.
The use of locally manufactured goods and Nigerian service companies creates jobs in the communities we operate. In 2015, $0.9 billion was spent by SPDC and SNEPCo on local contracting and procurement. Ownership of key assets such as rigs, helicopters and marine vessels is a key focus and SCiN have been recognised for their work in local content, including the Local Content Operator of the Year Award by the Petroleum Technology Association of Nigeria (PETAN) in 2013 and 2015.
SCiN pursue a variety of social investment projects, with particular focus on community and enterprise development, education and health. In 2015 Shell-operated ventures contributed.
- $145.1 million (Shell share $62.3 million) to the Niger Delta Development Commission (NDDC) as required by law
- $50.4 million (Shell share $15.4 million) was directly invested by the SPDC JV and SNEPCo in social investment projects.
Collectively, this makes Nigeria the largest concentration of social investment spending in the Shell Group.