Shell sells 30% stake in Nigeria’s OML 18 for $737m

Royal Dutch Shell has sold its 30% interest in the oil mining lease (OML) 18 in Nigeria to Eroton Exploration & Production Company for $737m.

The sale, which includes associated facilities in the Eastern Niger Delta, was completed through the Shell Petroleum Development Company of Nigeria (SPDC).

SPDC is the operator of a joint venture agreement involving the Nigerian National Petroleum Corporation, Shell, Total Exploration and Production Nigeria and Nigerian Agip Oil Company.

OML18 covers an area of 1,035km² and includes the Alakiri, Cawthorne Channel, Krakama, and Buguma Creek fields and associated facilities.

The transaction includes flow stations together with related gas infrastructure as well as oil and gas pipelines within the OML, which produced about 14,000 barrels of oil equivalent per day in 2014.

Shell said the divestment is part of SPDC’s strategic review of onshore portfolio in the West African country and is in line with the Federal Government of Nigeria’s plan of developing local firms in the country’s upstream oil and gas business.

Eroton also acquired Total’s 10% interest and Eni’s 5% stake in OML 18, giving it a total 45% holding. Crude oil production from OML 18 is exported via the Bonny crude oil terminal through the Nembe Creek Trunkline.

Gas production from OML 18 is delivered to several power, industrial and commercial customers through the Nigeria Gas Company’s pipeline.