French oil and gas company TotalEnergies is looking to divest its minority stake in the Shell Petroleum Development Company of Nigeria (SPDC).
TotalEnergies owns a 10% stake in SPDC, a major onshore oil joint venture (JV) that is facing operational challenges and environmental issues, reported Reuters.
This move is part of the company’s strategy to realign its portfolio with its HSE policies.
During its annual results presentation, TotalEnergies CEO Patrick Pouyanné said: “We want to divest our share of SPDC, and we are looking to reshape the portfolio.”
He added: “Fundamentally it is because producing this oil in the Niger delta is not in line with our HSE policies, it is a real difficulty.”
SPDC, which has been plagued by hundreds of onshore oil spills attributed to theft, sabotage and operational issues, operates an extensive network of pipelines, oil and gas wells, gas plants, oil export terminals and a power plant.
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These challenges have led to costly repairs and high-profile lawsuits over the years.
Despite the planned divestment, TotalEnergies remains a significant player in Nigeria’s offshore sector, producing 219,000 barrels of oil equivalent per day in 2023.
The company recently announced the start-up of the Akpo West oilfield off the Nigerian coast.
Pouyanné highlighted the importance of Nigerian gas resources for TotalEnergies, describing them as crucial to the company’s planned expansion of liquefied natural gas development in the coming years.
Shell, which holds a 30% stake in SPDC, agreed last month to sell its share to a consortium for up to $2.4bn (£1.9bn).
The JV also includes the Nigerian National Petroleum Corporation with a 55% stake and Italy’s Eni with 5%.