Shell’s domestic gas distribution operations to continue under new ownership pending regulatory approval
Shell Petroleum B.V. has signed an agreement to sell its entire interest in the Shell Nigeria Gas (SNG) Group to Vaaris Energy Limited, a Nigerian energy company, in a move that marks a significant shift in the ownership of its domestic gas distribution business.
The transaction, announced in a statement on Tuesday, is subject to regulatory conditions and the necessary approvals.
The deal covers Shell Nigeria Gas Holding B.V., established in 2019, which owns all but one of the shares in SNG Limited, the company responsible for Shell’s domestic gas distribution operations in Nigeria.
Speaking on the transaction, Shell’s Country Chair in Nigeria, Elohor Aiboni, said Shell Nigeria Gas had served industrial and commercial customers across the country for more than 25 years, driven by the dedication and expertise of its workforce.
“We believe this agreement provides a much stronger platform for the business’ next chapter under new ownership. Shell continues to focus on strategic Deepwater and Integrated Gas positions in Nigeria,” Aiboni said.
Shell explained that the SNG Group would continue operating as usual and serving its customers until the transaction is completed.
The company said the planned divestment aligns with its broader strategy to simplify its portfolio and concentrate investments in areas where it possesses competitive strengths.
As part of this strategy, Shell intends to maintain its focus on deepwater and integrated gas operations in Nigeria, including its interest in Nigeria LNG Limited.
The company clarified that the Shell Nigeria Gas Group does not participate in upstream gas production, liquefied natural gas (LNG) operations, or international gas trading. Its activities are focused on distributing natural gas to domestic industrial and commercial consumers.
Established in 1998, Shell Nigeria Gas supplies natural gas to businesses and operates approximately 170 kilometres of pipeline infrastructure across Ogun, Abia, and Rivers states.
Its operations have supported gas supply to industrial and commercial customers, making it a notable player in Nigeria’s domestic gas distribution sector.
Vaaris Energy Limited, the prospective new owner, is a Nigerian energy company with interests across the oil and gas value chain and an existing operational presence in the country.
Although the transaction represents Shell’s exit from the domestic gas distribution business, the company’s planned continued involvement in Nigeria’s deepwater and integrated gas sectors signals that it is not withdrawing entirely from the country’s energy industry.
The completion of the transaction will depend on the fulfilment of regulatory requirements and other agreed conditions. Until then, Shell Nigeria Gas is expected to maintain its existing operations and customer services.
The development is expected to draw attention across Nigeria’s energy sector as stakeholders assess the implications of the ownership change for domestic gas distribution, industrial customers, and the country’s wider gas development ambitions.
