Shell has officially exited Nigeria’s onshore oil sector after completing the sale of its subsidiary, Shell Petroleum Development Company of Nigeria Limited (SPDC), to the Renaissance consortium.
The deal is valued at up to $2.4 billion.
This marks the end of nearly seven decades of SPDC’s operations in Nigeria’s onshore oil industry.
The company has been active in the country since 1937, pioneering oil exploration and production in onshore, shallow, and deep-water fields.
SPDC was Shell’s largest subsidiary in Nigeria. It discovered the country’s first commercial oil in 1956 and facilitated its first oil exports in 1958.
The company focused on onshore and shallow water assets in the Niger Delta. It operated a joint venture, often called the SPDC JV, with the Nigerian National Petroleum Corporation (NNPC) holding a 55% share.
SPDC owned 30%, while Total E&P Nigeria Ltd and Agip Oil Company Limited (a subsidiary of ENI) held 10% and 5%, respectively.
Though focused on onshore and shallow water oil operation, SPDC is just one of the three reported subsidiaries of the Shell parent company in Nigeria.
In 2024, Nigeria’s onshore oil sector saw a major shift in ownership. Several international oil companies (IOCs) sold key assets to local investors, marking the country’s second major divestment wave since the Niger Delta militancy era.
Many industry analysts attribute this shift —which has significant economic impacts—to the passage of the Petroleum Industry Act (PIA) of 2021 and the global transition to renewable energy.
The latest IOC in this divestment spree is SPDC—Nigeria’s foremost oil operator— which has been accused of decades of negative environmental practices in the Niger Delta.
Meanwhile, SPDC has sold its entire onshore and shallow water portfolio to Renaissance Group, leaving behind numerous unresolved environmental legal disputes.
This exit raises concerns about its impact on host communities in the Niger Delta, especially amid ongoing lawsuits.
Unresolved legal battles haunt Shell’s departure
The sale of Shell’s onshore assets to Renaissance Group has faced opposition from industry analysts, civil society organizations, and host communities, who accuse the company of abandoning its environmental responsibilities in the Niger Delta.
In February 2024, the Centre for Research on Multinational Corporations (SOMO) released a report arguing that Shell should not be allowed to exit the region without addressing its legacy of pollution and ensuring the safe decommissioning of abandoned oil infrastructure.
Two months later, in April, Amnesty International and other civil society groups called on the Nigerian government to block the sale, insisting that Shell must first clean up its operations in the region before divesting.
According to Amnesty international, the deal “appears to fall far short of several regulatory and legal requirements. These include the apparent lack of an environmental study to assess clean-up requirements, and an evaluation to ensure sufficient funds are set aside for potential decommissioning of oil infrastructure – a sum that is likely to amount to several billions of US dollars.“
Moreover, Shell still faces several unresolved legal battles as it exits Nigeria’s onshore sector.
Nigerian courts have ruled in favour of some claims, but the company has yet to make payments, citing ongoing appeals and legal disputes.
In September 2024, over 1,200 representatives from the Ilaje communities in Ondo State filed a lawsuit seeking NGN505 billion (approximately $310 million) in damages, alleging that Shell breached a court order by proceeding with the asset sale before resolving compensation claims related to environmental damages from oil spills.
The communities assert that these spills have devastated their waterways and farmland, leading to significant economic and environmental hardships.
Prior to this Ondo lawsuit, a Court of Appeal granted a landmark appeal in the claim of two communities in Delta State —Bille and Ogale—whose environment has been devastated by oil pollution, allegedly caused by Shell plc’s Nigerian subsidiary SPDC.
The court overturned the earlier High Court ruling that made it practically impossible for people to bring environmental claims involving multiple incidents of pollution.
The claims, which were started nearly 10 years ago, should finally move forward to a full trial with disclosure of important Shell documents.
Meanwhile, more than 13,000 residents from the Bille and Ogale communities say repeated oil spills from Shell Nigeria’s infrastructure have devastated their land, waterways, and drinking water. Each community has reportedly suffered around 100 spills, making farming and fishing—their primary livelihoods—increasingly difficult.
Although the government has now approved Shell’s departure, the company leaves behind millions of dollars in unresolved lawsuits filed by host communities over environmental degradation, oil spills, and human rights concerns.
Energy industry experts argue that Shell’s exit should not absolve it of responsibility for past environmental damage.
Esther Chinedu, a local content advocate and Brand Manager at Fairtex Group, said Shell’s exit from Nigeria’s onshore oil sector is not just a business transaction, it’s a moment of reckoning.
She added that beyond the legal battles and environmental damage, one of the most critical tasks for the new owners is rebuilding stakeholder confidence.
“The lawsuits against Shell may still be ongoing, but the new operators cannot afford to take a passive stance. They must introduce a clear, transparent model that prioritizes community development, environmental responsibility, and stakeholder engagement.”
“Thankfully, the Petroleum Industry Act (PIA) has made provisions for host community development, which is a good thing.
“However, having policies on paper is not enough. The new operators must be intentional about developing local capacities, creating jobs, and making real investments that uplift these communities. They need to go beyond handouts and find ways to build sustainable businesses that empower locals,” she added.
New owners face legacy of oil spills and pollution
On the other hand, Shell’s onshore operations in Nigeria have long been marred by oil spills and pollution.
With Renaissance now in charge of SPDC’s assets, the consortium will have to navigate the challenges left behind by Shell, including pending lawsuits and the environmental cleanup of affected areas.
Renaissance has pledged to work with local communities and the government to address these issues, but concerns remain about whether adequate measures will be taken.
As Shell shifts focus to offshore operations, the responsibility for addressing these environmental and legal issues now rests with the new owners.
Environmental and human rights groups have expressed concerns that Shell’s exit could hinder ongoing efforts to address pollution in the region.
On this, James Akwaji, a worker at the Production/Process Operations unit at Savannah Energy Plc, said Shell’s exit from onshore oil operations in the Niger Delta pose significant implications for pending litigations.
“Shell’s divestment may complicate legal proceedings. It could reduce its liability and ability to fulfill cleanup obligations in communities like Ogale, Bille and some others who are suing Shell over oil spills, seeking compensation for environmental damage and health impacts.
“This move can be seen as an attempt to evade accountability, leaving behind a legacy of pollution and economic harm. The sale may hinder the communities’ access to justice and compensation for past environmental injustices,” Akwaji added.
In her remark, Chinedo stressed the need for the Renaissance Group to ensure justice for the people of the Niger Delta.
“…the new buyers, Renaissance, must recognize that this acquisition comes with liabilities, not just assets. Nigerians are watching, and there is no expectation that we will simply turn a blind eye.”
She also suggested the need for Renaissance to take a people-oriented model in its operations in the region.
Nigerian government seeks to revive oil production
Meanwhile, the Nigerian government sees Shell’s exit as a chance to revive onshore oil production, which has struggled with pipeline vandalism, crude theft, and security threats.
By late January 2025, authorities were in talks with local communities to ensure stability and boost output in key oil-producing regions like Ogoniland, where SPDC had suspended operations for years due to conflicts.
But the prospect of restarting oil exploration in Ogoniland reignited controversy in February, sparking debate over economic benefits, environmental risks, and social consequences.
Host communities fear the move could undermine efforts to restore the environment and protect their livelihoods.
Despite these concerns, industry experts remain optimistic. They believe the government would not have approved the sale unless the new owners agreed to take on some responsibility for environmental damage.
Jide Pratt, Chief Operating Officer at Aiona and Country Manager of TradeGrid, suggested ways this could happen.
Meanwhile, others remain critical.
Allison Gabriel accused the government of ignoring the concerns of the Ogoni people by approving the deal.
“The deal has been approved finally by the government without any substantial assurance, compensation or even any clean up,” he said.
He added that despite lawsuits against Shell and warnings from international courts and organizations to halt divestment deals, the government proceeded with the sale, turning “blind eyes and deaf ears” to affected communities in the Niger Delta.
The future of Nigeria’s onshore oil industry
As major Western oil companies—including Shell, ExxonMobil, Eni, and Equinor—divest from onshore operations in Nigeria, the country’s oil landscape is increasingly shifting towards indigenous players.
The Nigerian government has actively encouraged local firms to acquire these assets, aiming to sustain investment and job creation within the sector.
However, environmental and human rights groups have raised concerns that the departure of international oil companies (IOCs) could undermine ongoing efforts to address pollution in the Niger Delta.
In response, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) introduced the Upstream Petroleum Decarbonisation Template (UPDT) in January 2025.
This policy now serves as a mandatory requirement for issuing licenses, permits, and approvals across all upstream activities.
What’s next for the Niger Delta?
The Niger Delta remains a region of immense economic potential but also deep environmental concern.
With Renaissance now taking over Shell Petroleum Development Company’s (SPDC) assets, host communities are watching closely to see whether the new operators will prioritize responsible production and environmental restoration.
However, activists and environmental groups fear that SPDC’s exit could complicate ongoing efforts to hold the company accountable for remediation.
Jide Pratt expressed his concerns about the longstanding legal battles that remain unresolved.
“The fact that the arm of justice in Nigeria grinds slowly makes the issue of her (SPDC’s) exit a worry, in terms of quick resolution to pending legal issues bordering on abandonment. To think we have pending legal issues on the Ogoni clean-up is a testament to this,” Pratt said.
He further cautioned that the new companies taking over could find themselves entangled in fresh litigation, which could ultimately hinder productivity and revenue generation.
The transition of SPDC’s assets to Renaissance represents both a challenge and an opportunity for Nigeria’s oil industry as it navigates the future of energy production.
As local content advocate Esther Chinedu put it, whether the asset transfer “leads to progress or more problems depends on the actions taken now” by all stakeholders involved.
