Shell to exit Nigeria’s gas distribution business, sell stake to Vaaris Energy

Shell has agreed to sell its entire stake in Shell Nigeria Gas Group to indigenous energy company Vaaris Energy Limited, ending its involvement in Nigeria’s domestic gas distribution  business after more than two decades of supplying industrial and commercial customers.

Vaaris Energy Limited is a Nigerian energy company with interests spanning the oil and gas value chain and an established operational presence in the country.

Announced by Shell Petroleum B.V., the transaction transfers ownership of a business created to distribute natural gas to Nigerian industries. Shell Nigeria Gas operates approximately 170 kilometres of pipeline infrastructure across Ogun, Abia and Rivers states, serving more than 130 connected customers.

The divestment reflects Shell’s ongoing efforts to restructure its Nigerian portfolio, with the international energy company focusing its investments on deepwater oil production and integrated gas operations, including its interest in Nigeria LNG Limited.

Established in 1998, Shell Nigeria Gas has played a significant role in supplying natural gas to industrial and commercial consumers across the country.

Commenting on the transaction, Shell’s Country Chair in Nigeria, Elohor Aiboni, said the business had served industrial and commercial customers for more than 25 years, supported by the dedication and expertise of its workforce.

She said the agreement would provide a stronger foundation for the company’s next phase of growth under new ownership, while reaffirming Shell’s commitment to deepwater and integrated gas investments in Nigeria.

The transaction covers Shell Nigeria Gas Holding B.V., established in 2019, which owns all but one of the shares in Shell Nigeria Gas Limited.

However, the deal remains subject to regulatory conditions and the necessary approvals. Until completion, Shell Nigeria Gas Group will remain part of Shell and continue its operations and customer services as usual.

The company’s activities are limited to domestic gas distribution, with no involvement in upstream gas production, liquefied natural gas (LNG) or international gas trading.

Shell said the sale aligns with its strategy of simplifying its portfolio and allocating capital to businesses where it believes it has competitive advantages.

The company’s retained interests in Nigeria’s deepwater sector and integrated gas business, including Nigeria LNG, remain central to its long-term strategy.

The financial terms of the transaction were not disclosed.