How Nigerian oil firms are rewriting Africa’s energy future

The recent news of the acquisition of Shell’s assets in Nigeria by Renaissance Energy has added another layer to the wave of divestment by major oil companies to independent operators across Africa, KINGSLEY JEREMIAH writes.

From a pan-African outlook, independent oil and gas companies are reshaping the energy industry’s future. This development is redefining energy ownership and management. In Nigeria alone, Shell divested $2.4 billion to Renaissance Africa Energy, TotalEnergies had divested over $900 million to Chappal Energies, Eni divested over $800 million worth of assets to Oando, ExxonMobil’s $1.3 billion sale to Seplat Energy and Equinor’s $1.2 billion divestment to Chappal Energies are a pointer to the readiness of African investors to control their assets.

The recoverable oil from these reserves stands at about 2,325 million barrels of crude oil, showing that the about 100 years of IOC dominance on the continent is nearly at an end and the sector is moving towards a $2 trillion value opportunity for national players and investors.

Like Nigeria, Panoro Energy has acquired all of Tullow’s assets in Equatorial Guinea and the Dussafu asset in Gabon for $180 million. Similarly, Savannah Energy had finalised a $407 million acquisition of ExxonMobil’s upstream and midstream businesses in Chad and Cameroon.

Another completed transaction involved ETU Energias, which acquired Galp Energia’s stake in offshore Angola for $443 million. In Gabon, Assala Energy successfully acquired Shell’s onshore assets for $628 million. Apex also completed a $45 million deal, acquiring six concessions from the International Egyptian Oil Company.

Chairman of the African Energy Chamber, NJ Ayuk noted that independent oil and gas companies are critical to Africa’s energy future, stressing that their role would grow as Africa works to make energy poverty history.

The $2.4 billion acquisition of Shell’s Nigerian onshore assets by Renaissance Africa, the latest in Nigeria, is seen by some stakeholders as being far from just a corporate transaction but another strong wave of independent oil operators in the African energy landscape.

Renaissance Africa comprises five local companies—ND Western Ltd., Aradel Holdings Plc, Petrolin Group, First Exploration and Petroleum Development Co., and The Waltersmith Group. Together, they now control approximately 6.73 billion barrels of oil and condensate and 56.27 trillion cubic feet of gas. These resources hold the potential to power Nigeria’s economy for decades and elevate the nation’s global energy profile.

A banker and economist, Wumi Adeniyi, explained that Nigeria’s oil and energy fortunes are not commensurate with the level of development the country currently enjoys.

“The profits that will be made by Nigerian oil and energy companies will stay in the country, providing much-needed capital for the various development projects of the government,” Adeniyi stated.

For stakeholders like Adeniyi, ensuring that independent oil companies like Renaissance take control of dormant assets and increase the country’s struggling oil production while boosting revenue is important.

The growing divestment, which is bridging the funding crisis from the international community, is also being seen as Nigeria’s growing capacity to finance and manage large-scale energy projects.

Stakeholders also project more benefits for local banks, safety consultants, engineering firms, and other service companies as Nigeria deepens local content and looks to help other African countries take advantage of their oil resources amidst pushback by climate change.
However, challenges remain. Renaissance and other indigenous operators must navigate community relations, rehabilitate ageing infrastructure, and deliver profitable operations.

The environmental stakes are particularly high looking at decades of oil spills, gas flaring and oil theft in the Niger Delta. This places more burdens on these indigenous operators to go over and above to prove that local ownership does not equate to lower environmental standards, committing to sustainable practices and fostering stronger community ties.

With pressure globally to reduce fossil fuel reliance, Nigeria’s economic realities require a nuanced approach where local control of gas resources presents an opportunity to support industrialisation and explore hybrid energy solutions, blending fossil fuels with renewables.
International oil companies and institutions must adapt to this shift by forming partnerships focused on technology transfer, capacity building, and sustainable development. Shell, for instance, retains investments in offshore projects like Bonga North, highlighting opportunities for collaboration.

For the Nigerian government, this acquisition demands consistent policies, transparent regulations, and strong institutional support.

An energy expert, Prof. Wunmi Iledare noted that “The approval of Shell’s divestment was overdue. The government must now enable an environment that supports local operators while ensuring accountability.”

According to him, divestment is a good business practice in petroleum business which is critical for energy security.

“The delay in the approval has been quite disconcerting with time value of money implications. The group understands the petroleum business and my wishful thinking is for NNPCL to sell part of their shares and become a minority shareholder similar to the NLNG model,” he said.