The backlash against the $2.4 billion divestment of Shell Petroleum Development Company (SPDC) of Nigeria Limited took a different turn yesterday as Global Gas and Refining Limited, a Nigerian subsidiary of Houston-managed Global Energy Inc, and other stakeholders raised fresh concerns over the deal.
 
This came as the Minister of Petroleum Resources (Oil), Heineken Lokpobiri, SPDC and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) kept mum over the purported approval, as stakeholders insisted that the President Bola Tinubu might have abandoned the rule of law and oil politics in the altar of political considerations.
  
SPDC and NUPRC are already taking an oath at the Federal High Court in Abuja, file number FH/ABJ/CS/413/2024, not to proceed with the divestment pending the outcome of the court decision over the matter. In a hearing slated for Wednesday, January 22, 2025, in Abuja before Justice Inyang Ekwo, stakeholders described the approval of the divestment during ongoing negotiations as an affront to justice.
 
But while energy expert, Prof. Wunmi Iledare, praised the approval, his environment counterpart, Nnimmo Bassey, strongly condemned the divestment as an “endorsement of impunity” and a betrayal of the Niger Delta people and environment.
 
At a press conference in Abuja over the protracted legal battle, Chairman of Global Gas, Kenneth Yellowe, said the approval remained “unwelcome and must be condemned by all who mean well for Nigeria.”
 
He noted that the company had been negotiating with Shell concerning its loss from a botched $0.5 billion (N774.5 billion) gas investment, but had been frustrated for over 14 years. 
 
Accusing Shell of being good in disobeying court orders in Nigeria, “something they will never contemplate or dare to do in their home country or other developed countries,” Yellowe said the development was a clear demonstration of Shell’s contempt for good governance, legal processes and the rights of Nigerian businesses and communities, particularly those in the Niger Delta.
 
Yellowe said Global Gas entered a long-standing contractual arrangement with Shell in 1998, investing approximately $0.5 billion in a gas processing facility tailored to receive supplies from Shell’s Cawthorne Channel Oil and Gas fields in OML 18. He added that although Shell commenced gas supplies in 2005, the deliveries soon became sporadic, leading to the shutdown of Global’s operations. 
  
According to him, the company obtained evidence showing that Shell prioritised international markets over its domestic supply obligations, deliberately neglecting its agreement with Global Gas.
 
He added that amid protracted legal disputes, Global Gas sought an injunction to prevent Shell’s divestment without resolving the outstanding contractual issues. He noted that while the court directed negotiations, approval was granted for Shell’s divestment, allegedly violating the court’s order.  
 
NUPRC had on September 11, 2024, refuted reports on approving the divestment of Shell, stating then that it would remain committed to transparency and that it would announce its position on the transaction at the appropriate time.  
 
In October, NUPRC rejected the bid, saying “the divestment of SPDC’s assets to Renaissance Africa Energy Company Limited could not scale regulatory test.”
While the regulatory approval was not officially announced, Renaissance Energy announced, last week, that Nigeria’s oil minister approved the sale of the $2.4 billion in onshore and shallow-water assets.
 
With a series of legal battles over the sale of the assets and environmental issues, Nigerian communities have pursued legal action against Shell over environmental damages. 
 
In Okpabi v. Shell, over 13,000 individuals and institutions from Ogale and Bille sought accountability for oil spills. The High Court in Rivers State ordered Shell to pay N800 billion ($878 million) to the Egbalor Ebubu community for a devastating oil spill. Shell appealed the case.  
 
Similarly, four Nigerian farmers from Oruma, Goi and Ikot Ada Udo sued Shell in The Netherlands, leading to a €15 million settlement in 2022 for pollution of their farmlands and fishponds.
 
Former legal practitioner at Shell, Ameh Madaki, described the Shell divestment to Renaissance Africa Consortium as mired in legal and regulatory controversies, noting that the approval for the transaction, despite an earlier rejection, surprised industry stakeholders, particularly given the intense behind-the-scenes lobbying to secure the outcome.
 
“The last has not been heard of the controversies surrounding this transaction because, apart from the claim by Global Gas and Refining Limited, the Ilaje Community in Ondo State and the Egbalor Community in Eleme, Rivers, also have subsisting Mareva injunctions against Shell restraining the divestment. Both Shell and Renaissance Africa would have to meander through these minefields of litigation before they will be able to actualise the transaction,” he said.
 
Director at the Centre for Democracy and Development, Dr Garuba Dauda, said, “Oil is ruled more by politics than law,” adding that “rather than a violation of the law, what has happened is simply a fall of the law for politics.”
 
According to the energy expert, those truly grounded in the politics of oil business and the business of oil policies will not be shocked by recent happenings.
 
SPDC’s Media Relations Manager, Gladys Afam-Anadu, did not respond to the development, even as the Chairman of NUPRC, Gbenga Komolafe, did not respond to a series of messages over the issue. Iledare, on his part, described the approval as “good economic sense” and a sound business practice in the petroleum sector.
 
“Divestment is a common strategy in the petroleum business. With NNPC Limited being the majority owner of the assets, its consent was crucial, and I’m glad they gave it,” he said.   

He also commended the Federal Government and NUPRC for approving the deal, arguing that prolonged delays in the process had caused unnecessary economic implications.
 
However, Bassey accused the Federal Government and NUPRC of allowing Shell to evade accountability for decades of pollution and environmental degradation. 
 
“The government’s approval of this deal disregards the ecological crimes committed by Shell and other international oil companies (IOCs). The evidence is clear in reports like the United Nations Environmental Protection (UNEP)’s 2011 Ogoniland assessment and the 2023 Bayelsa State Oil and Environment Commission report,” he stated.