Vaaris Energy agrees to buy Shell’s industrial gas network in Nigeria

Shell has signed an agreement to sell Shell Nigeria Gas, which runs about 170km of pipeline serving more than 130 businesses in Ogun, Abia and Rivers, to the Nigerian company Vaaris Energy. Shell keeps its deepwater and integrated gas positions in Nigeria, including its interest in Nigeria LNG.

Once regulators approve the deal, about 170km of gas pipeline running through Ogun, Abia and Rivers will pass to Vaaris Energy, a Nigerian company with interests across the oil and gas value chain, along with the more than 130 connected customers who take their gas from it. Shell Petroleum B.V. signed the agreement on 13 October, and the terms of the Shell Nigeria Gas sale have not been disclosed.

Until completion the business remains part of Shell and keeps supplying its customers as normal. The sale covers Shell Nigeria Gas Holding B.V., the vehicle set up in 2019 that holds all but one share in Shell Nigeria Gas Limited.

Shell Nigeria Gas was incorporated in 1998 to distribute gas to Nigerian industry. In the 28 years since, it has kept to that business, supplying piped gas directly to factories and businesses, with no part in upstream production or LNG.

Elohor Aiboni, Shell’s Country Chair in Nigeria, said the business had served its customers “for more than 25 years, supported by the commitment and expertise of its people”. She added that the agreement “provides a much stronger platform for the business’ next chapter under new ownership”.

The sale fits the portfolio simplification Wael Sawan has pursued as chief executive. It leaves Shell in Nigeria with the positions it has chosen to keep, including its interest in Nigeria LNG. “Shell continues to focus on strategic deepwater and integrated gas positions in Nigeria,” Aiboni said.