Shell Awards $1.98 Billion Contracts to Nigeria's Local Firms in 2023

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Shell plc SHEL, a British multinational oil and gas company headquartered in London, has announced that its units in Nigeria awarded remarkable $1.98 billion worth of contracts to Nigeria’s companies ...

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This figure represents a 3% increase compared with 2022, marking a steady commitment by the British oil giant to foster local business development and strengthen its operations in the nation of West Africa.The key entities behind these significant contract awards were the Shell Petroleum Development Company of Nigeria Ltd. , Shell Nigeria Exploration and Production Co. Ltd.  and Shell Nigeria Gas. The contracts cover various aspects of Shell’s operations in the country, including oil exploration, production and gas operations. By collaborating with Nigeria-registered companies, Shell continues to support the country’s industrialization, ensuring that the benefits of the oil industry are shared more equitably across the nation.","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU2237443382.USD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A MIncA USD","LU0098860793.USD":"FRANKLIN INCOME \"A\" INC","LU2237443549.SGD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A MIncA SGD-H","LU0278409577.USD":"MANULIFE GLOBAL FUND-GLOBAL RESOURCES FUND \"AA\" (USD) INC","LU1162221912.USD":"FRANKLIN INCOME \"A\" (USD) ACC","LU2237443465.HKD":"abrdn SICAV I -  GLOBAL DYNAMIC DIVIDEND \"A\" (HKD) INC","LU2237443622.USD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A Acc USD","SHEL":"SHELL PLC SPON ADS EACH REPR 2 ORD SHS","LU2237443978.SGD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A Acc SGD-H","BK4588":"碎股","LU0320765646.SGD":"FTIF - Franklin Income A MDIS SGD-H1","TTE":"道达尔","POFCY":"Petrofac Ltd","BK4179":"石油天然气设备与服务","LU2236285917.USD":"ALLIANZ GLOBAL INCOME \"AMG\" (USD) INC","OVV":"Ovintiv Inc.","BK4561":"索罗斯持仓","LU0300736492.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) INC","LU0300736062.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) ACC","BK4213":"石油与天然气的勘探与生产","LU2129689605.HKD":"FRANKLIN GLOBAL INCOME \"A\" (HKD) INC","LU2237443895.HKD":"abrdn SICAV I -  GLOBAL DYNAMIC DIVIDEND \"A\" (HKD) ACC","BK4201":"综合性石油与天然气企业","LU2129689514.USD":"FRANKLIN GLOBAL INCOME \"A\" (USD) INC","LU2129689431.USD":"FRANKLIN GLOBAL INCOME \"A\" (USD) ACC","BK4585":"ETF&股票定投概念"},"translate_title":"壳牌将于2023年向尼日利亚当地公司授予价值19.8亿美元的合同","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"TTE":1,"POFCY":1,"OVV":1,"SHEL":0.9},"content_text":"Shell plc SHEL, a British multinational oil and gas company headquartered in London, has announced that its units in Nigeria awarded remarkable $1.98 billion worth of contracts to Nigeria’s companies in 2023. This figure represents a 3% increase compared with 2022, marking a steady commitment by the British oil giant to foster local business development and strengthen its operations in the nation of West Africa.\nThe key entities behind these significant contract awards were the Shell Petroleum Development Company of Nigeria Ltd. (“SPDC”), Shell Nigeria Exploration and Production Co. Ltd. (“SNEPCo”) and Shell Nigeria Gas. The contracts cover various aspects of Shell’s operations in the country, including oil exploration, production and gas operations. By collaborating with Nigeria-registered companies, Shell continues to support the country’s industrialization, ensuring that the benefits of the oil industry are shared more equitably across the nation.\nEmpowering Local Companies and Promoting Expertise\nShell’s focus on Nigeria’s businesses is a deliberate effort to enhance local capacity, strengthen financial stability and improve operational expertise. According to Shell’s recent press release, many of the companies benefiting from these contracts have expanded their operations and improved overall business strength. This growth, both in terms of expertise and financial health, has allowed these local firms to take on even more complex and large-scale projects, fueling Nigeria’s progress in the global energy market.\nOlaposi Fadahunsi, business opportunity manager for SNEPCo’s Bonga South-West Aparo Project, remarked, “Nigerian content will continue to be an important part of Shell operations.” This statement affirms Shell’s long-term strategy to not only strengthen Nigeria’s energy sector but also contribute to the economic empowerment of local businesses through ongoing partnerships.\nSHEL’s Role in Nigeria’s Economic Landscape\nThe energy giant’s investments extend beyond the awarded contracts. Shell remains a key player in Nigeria’s economy, as evidenced by the $4.9 billion paid to the government of Nigeria in 2023 alone. This figure is part of a larger $67 billion payment across 26 countries in which Shell operates. The bulk of these payments, $727.9 million in royalties, indicates Shell’s significant contribution to Nigeria’s public finances.\nAdditionally, Shell made an impressive commitment to Nigeria’s economic future by pledging a $6 billion investment in the country. This investment will largely go toward expanding the Bonga oil field project, an ambitious initiative, aimed at boosting Nigeria’s oil production capacity and supporting Shell’s position in the energy sector of West Africa. The pledge was confirmed during a meeting between Shell’s representatives and president Bola Tinubu in December 2023, highlighting Shell’s ongoing commitment to the country’s development.\nNavigating Change: Shell’s Exit From Nigeria’s Onshore Operations\nWhile Shell continues to deepen its relationships with local businesses, the company is also strategically turning its operations in Nigeria. In January 2024, Shell announced an agreement to divest from its onshore operations in the country. The divestment, which involves Shell’s SPDC unit, will transfer its operations to a local consortium led by Renaissance Africa Energy Co. Ltd. However, regulatory hurdles have prevented the completion of this transaction with Shell still awaiting clearance from Nigeria’s authorities.\nThis decision aligns with Shell’s broader strategy to move away from onshore oil production, which has been increasingly plagued by oil theft and sabotage. Despite the challenges, Shell’s offshore projects, such as the Bonga field, continue to thrive, offering a more stable and profitable avenue for growth.\nFuture of Shell in Nigeria: Continued Investment in Offshore Projects\nDespite the exit from onshore operations, Shell remains fully invested in Nigeria’s offshore oil and gas industry. The company is committed to expanding the Bonga field. This move is expected to boost Nigeria’s production capabilities and provide significant economic benefits to the country. Shell’s ongoing projects in Nigeria’s offshore fields demonstrate its focus on sustainable energy extraction and the long-term growth of the country’s oil sector.\nIn addition to Shell, France-based integrated oil and gas company, TotalEnergies SE TTE has also taken steps to divest its stake in the SPDC Joint Venture (“JV”), selling 10% stake. While Shell owns a 30% share of the SPDC JV, Nigerian National Petroleum Co. Ltd. remains the major stakeholder with a 55% interest. Shell’s future in Nigeria, particularly in offshore ventures, will continue to be an important factor in the country’s energy landscape, with local businesses and the economy of Nigeria benefiting from these operations.\nOverall, Shell’s investments in Nigeria show its ongoing commitment to supporting the local economy. By awarding $1.98 billion in contracts to Nigeria’s companies in 2023, Shell has been helping strengthen local businesses and ensure the sustainability of the country’s energy sector. Even though Shell has faced challenges with its onshore operations, the company remains focused on offshore projects and long-term investments, which will continue to play a crucial role in Nigeria’s energy future.\nSHEL’s Zacks Rank & Key Picks\nCurrently, SHEL and TTE both have a Zacks Rank #3 (Hold).\nInvestors interested in the energy sector might look at some better-ranked stocks like Petrofac Limited POFCY and Ovintiv Inc. OVV, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.\nPetrofac is valued at $63.17 million. This oil and gas equipment and services company operates across four segments including Onshore Engineering & Construction, Offshore Projects & Operations, Engineering & Consulting Services and Integrated Energy Services.\n\nOvintiv is valued at $10.73 billion. This company currently pays a dividend of $1.2 per share, or 2.91%, on an annual basis. OVV is an independent energy producer, which explores and churns out oil and natural gas from diverse assets located in the United States and Canada.\n\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nPetrofac Ltd. (POFCY) : Free Stock Analysis Report\nOvintiv Inc. (OVV) : Free Stock Analysis Report\nTotalEnergies SE Sponsored ADR (TTE) : Free Stock Analysis Report\nShell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"corporation","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2490092234"}