Royal Dutch Shell is opening a playbook which may rattle everyone in Nigeria. The energy giant believes that pumping hydrocarbons from Nigerian swamps may not be part of its green future: “In February, Shell reached an agreement with Amazon to provide renewable power from a subsidy-free offshore wind farm being constructed off the coast of The Netherlands, marking a major step in its quest to go green.”
More so “The Nigerian government is in talks with Shell and is encouraging the company to keep its onshore operations instead of divesting, said Timipre Sylva, minister of state for petroleum resources.” Yes, Nigeria is now begging Shell to stay!
Royal Dutch Shell Plc has been under increasing pressure from investors to slash emissions and pivot toward cleaner energy, and the tension was on show at its shareholder meeting on Tuesday.
The company’s long-term energy transition plan, laid out to investors for the first time, received overwhelming support, but a competing resolution asking for stricter targets also garnered more votes than ever. Adding to the tension, shareholders were meeting as the International Energy Agency warned that all new oil and gas developments need to stop immediately for climate targets to be met.
Shell also acknowledged its green strategy is complicated by its spill-prone operations in Nigeria, where it has been pumping out oil for half a century.
The Anglo-Dutch company has been gradually selling onshore assets in the West African country for more than a decade, as it sought to put aside chronic problems such as pollution caused by ruptured pipelines and the resulting legal battles with local communities.
The issue has become more acute in the past year after Shell pledged to transform itself into clean energy giant and gradually wind down its oil and gas business to achieve net-zero carbon emissions by 2050.
He didn’t say explicitly that Shell wants to sell the remainder of its oil assets in the Niger Delta, nor did he provide a timetable. Yet a full retreat would be an obvious end point to years of gradual divestment. Shell has reduced its total number of onshore licenses in Nigeria by half over the past decade. It would focus on offshore oil fields and gas operations in the country, van Beurden said.
Yesterday, speaking in a development commission for the northern part of Nigeria, I posited that, in 25 years, some of the most vital natural assets, in Nigeria, will be north of River Nigeria Benue. Yet, the economies of the future would not be built on deposits of raw materials but mines of knowledge and ingenuity of the citizens.
Shell, Mobil, Chevron and the oil majors will leave very soon. As that happens, how is Nigeria planning? Yes, As President Biden tobacco-lizes oil, making it an unwelcome toxic product for markets, the next few years will be huge.
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