Anglo-Dutch energy giant Shell Plc paid a record $5.34 billion to the Nigerian government in 2024, its highest remittance to any country last year, even as it continues a strategic exit from onshore oil operations in Nigeria.
This figure, disclosed in the company’s recently published Payments to Governments report for 2024, significantly outpaces what it paid to any other host country, including oil-rich Oman, Brazil, Norway, and Qatar.
The report, a regulatory requirement under UK law, is designed to improve transparency around the financial relationships between extractive companies and the governments of the countries in which they operate. Nigeria’s top spot on Shell’s payout list once again underscores the scale and importance of the company’s longstanding operations in Africa’s largest oil-producing nation.
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Shell’s payments to Nigeria in 2024 marked a sharp increase from the $3.8 billion it remitted in 2023. The company attributed the jump primarily to production entitlements under joint ventures and production sharing contracts, which accounted for over $3.8 billion of the total disbursement. Taxes amounted to $648.7 million, while royalties contributed $770.2 million. Another $102 million came from fees and various statutory charges.
Out of the $5.34 billion total, a lion’s share—more than 71 percent—went to the Nigerian National Petroleum Corporation (NNPC), which received $3.8 billion. Shell also paid $648.7 million to the Federal Inland Revenue Service (FIRS), $781.9 million to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), $97.2 million to the Niger Delta Development Commission (NDDC), and approximately $3.9 million to the National Agency for Science and Engineering Infrastructure (NASENI). These payments were tied to Shell’s obligations under joint venture agreements, royalties, corporate income tax, and various statutory levies.
Detailed project-level disclosures included in Shell’s report reveal that the company’s East Asset, one of its key upstream hubs in the Niger Delta, attracted the highest production entitlement payments at over $1.3 billion. The East Asset spans several Oil Mining Leases (OMLs) and is pivotal in Shell’s production footprint in Nigeria. The company’s operations under Oil Mining Lease 133, which it jointly operates with TotalEnergies and the Nigerian government, brought in $136.6 million, primarily from tax obligations. Meanwhile, a group of deepwater and shallow water assets—OML 212, OML 118, OML 135, and Oil Prospecting Licence 219—together generated $1.4 billion in combined entitlements, taxes, royalties, and fees.
Globally, Shell disbursed $28.1 billion to various governments in 2024, down five percent from the previous year, reflecting weaker commodity prices and declining profits. While Nigeria ranked highest, Brazil followed with $4.5 billion in payments. Oman received $4.3 billion, Norway $3.38 billion, and Qatar $3.33 billion.
In contrast, several African countries where Shell maintains smaller operations received relatively modest sums. Egypt received $43 million. São Tomé and Príncipe, where Shell has exploration interests, received just $1.3 million. Tanzania and Tunisia received $140,000 and $29.3 million, respectively.
In an ironic twist, Shell received a refund of $32 million from the UK government due to decommissioning cost recoveries related to the Brent field and other aging North Sea infrastructure. That figure was lower than the $43 million refund the company received from the UK government in 2023.
However, the scale of Shell’s financial contribution to Nigeria, despite its divestment push, raises difficult questions about the sustainability of oil revenues as international majors reduce their exposure to the country’s challenging onshore environment. Shell has been present in Nigeria for over 80 years but has been selling off its onshore oil fields after years of security threats, community unrest, oil theft, environmental degradation, and litigation over oil spills. The company has framed the move as a strategic simplification of its global portfolio and part of a wider ambition to become a net-zero emissions company by 2050.
While Shell exits the high-risk Niger Delta terrain, it continues to hold deepwater assets, which it considers safer and more consistent with its long-term energy transition goals. Operations such as the Bonga field, which Shell operates through its Nigerian subsidiary, remain a core part of its production base and continue to generate significant government revenues.
However, the current level of contribution may not be sustainable. Shell’s departure from onshore production, combined with similar divestments by other International Oil Companies (IOCs), has sparked concerns over revenue shortfalls and accountability in the wake of asset transfers to local operators, many of whom may lack the financial or technical capacity to maintain production levels or regulatory compliance.
In March 2025, Nigeria’s House of Representatives summoned 48 oil companies, including Shell Nigeria Exploration and Production Company, to appear before its Committee on Public Accounts over a combined debt of N9.4 trillion. The probe stemmed from damning findings in the Auditor-General’s 2021 report on the consolidated federal financial statements. Among the summoned firms were other industry heavyweights such as Chevron Nigeria Ltd, TotalEnergies E&P Nigeria, Seplat Energy, Oando Oil Ltd, and Mobil Producing Nigeria Unlimited.
In the same month, the Nigeria Extractive Industries Transparency Initiative (NEITI) announced it had commenced a comprehensive review of divestment transactions involving 26 oil blocks sold by five international oil majors, amounting to over $6.03 billion. The agency emphasized the need for transparency and strict adherence to due process in all such deals, given their long-term implications for revenue generation and environmental management.
Shell’s $2.4 billion divestment to Renaissance, a Nigerian-led consortium, is one of the major transactions under NEITI’s scrutiny. Others include ExxonMobil’s attempted $1.28 billion sale of its onshore and shallow water assets to Seplat, which is still awaiting regulatory clearance, and TotalEnergies’ $860 million divestment to Chappal.
NEITI has flagged concerns that these transfers, while intended to localize ownership and improve operational efficiency, risk being marred by opacity and non-compliance with Nigeria’s oil sector reforms under the Petroleum Industry Act (PIA). The agency stressed that asset sales must not become backdoor exits for IOCs looking to abandon environmental and financial liabilities.
As Shell’s payments show, international oil companies remain central to Nigeria’s oil-dependent economy. But with their exits accelerating, Nigeria faces the daunting task of replacing not just the technical expertise and capital inflows, but also the billions in annual revenues that these companies currently contribute.
Whether indigenous firms can fill this gap, and whether the regulatory institutions tasked with overseeing this transition can do so transparently and effectively, remains one of the most critical questions facing Nigeria’s energy sector today.