Message from Country Chair of Shell Companies in Nigeria
Our relationship with Nigeria remains strong and we are focusing our ambitions on our Nigerian deep-water production and gas distribution businesses
As I look back over 2021, I stand in awe of the sheer grit and determination of our staff and contractors that have enabled us to achieve most of our business goals despite the challenges that we have faced and continue to face. The year has so many success stories, including how we are advancing our ambitions in gas distribution and deep-water exploration and production.
However, Shell Companies in Nigeria, like other operators, have suffered from a growing number of sabotage attacks on our oil wells and pipelines, as well as the rising levels of crude oil theft. This forced us to declare a force majeure on our Bonny export programme, effective March 3, 2022. Now is the time to remind ourselves of a stark reality: the theft of crude oil is also the theft of jobs and opportunity. The illegal actions of third parties are robbing Nigeria’s economy of billions of dollars and this must end.
I am also saddened by an unprecedented tragedy. In August 2021, gunmen attacked a convoy of buses carrying workers to the Assa North/Ohaji South gas project. They killed six contract workers and one government security agent. Seven others were injured. My thoughts and those of Shell are with the families who have lost their loved ones. We provided emergency support immediately after the attack and assisted in the investigation. I hope we never again witness such a horrific incident.
We value our communities
Despite the security challenges we face, Shell Companies in Nigeria continue to contribute positively to the communities where we do business. Alongside our long-standing health-care, education, enterprise development and community-led programmes, we have financially supported the purchase of vaccines for Nigeria through COVAX and we have launched awareness-raising and vaccination campaigns.
Once again, the highest concentration of direct social investment in 2021 within the Group was made in Nigeria. As a development partner with a strong belief in Nigeria, we will continue to support the country’s aspirations towards achieving the UN’s Sustainable Development Goals.
We are making advances within the access-to-energy space. All On, a not-for-profit, impact investment company to which SPDC and SNEPCo have committed around $200 million, has helped renewable energy start-ups to connect 45,000 off-grid customers and aims to increase this to 75,000 in 2022. All On, together with Odyssey Energy Solutions and the Global Alliance for People and Planet also launched a global procurement programme for renewable energy companies to help bring affordable, high-quality solar products to the Nigerian communities most in need.
On behalf of Shell Companies in Nigeria, I congratulate All On for winning the 2021 impact investor of the year award in Nigeria conferred by the Impact Investors Foundation.
I am also very proud to announce the completion of the Oloibiri Health Campus in the Ogbia area of Bayelsa State. Oloibiri holds a special place in the heart of Shell Companies in Nigeria because it is where we discovered oil many decades ago. The campus will be commissioned later in 2022 and includes a primary health-care facility and a centre for specialist health services.
Shell’s relationship with Nigeria is strong
Shell has announced its intention to review options for its onshore Nigeria portfolio but Shell’s relationship with Nigeria remains strong. We may be changing the content of our portfolio but this is because we intend to focus future investment in Nigeria on deep-water exploration and production, and expanding our gas distribution network for domestic and international customers.
In 2021, the Bonga field’s oil mining lease (OML) 118 and its production sharing contract (PSC) were renewed for another 20 years. This lease underpins our deep-water operations. Its renewal opens up further opportunities for Shell in Nigeria.
We also successfully launched the Shell Energy Nigeria business line to expand the gas distribution solutions being championed by SNG. I am confident that this move will extend the efforts of Shell in delivering gas for power and industrial use across the country.
Natural gas is a critical component of Nigeria’s economy and is very significant for the country’s energy transition. The growing global market for LNG is also driving the development of Nigeria LNG’s expansion with the construction of Train 7, which will increase production capacity by 35% from the current 22 million to 30 million tonnes a year.
Recognition for Shell Companies in Nigeria
Shell Companies in Nigeria received a number of accolades in 2021. For example, in May, we were named the International Oil Company with the most impactful Local Content Initiatives at the Nigerian Oil and Gas Opportunity Fair. In December, Nigeria’s Tertiary Education Trust Fund described the consistent contributions of SNEPCo to education in Nigeria as exemplary and worthy of emulation by other corporates.
Looking ahead, I hope that the business environment remains conducive to existing and new investors. I have no doubt that Nigeria, Nigerians and my colleagues across Shell Companies in Nigeria will face whatever they must with the same compassion, dignity and resilience that they have always shown.