Nigeria has blocked Shell's sale of its entire onshore and shallow-water oil operations, but approved a similar deal by Exxon Mobil, the country's upstream oil regulator said on Monday, Report informs via Reuters.
Shell's asset sale for up to $2.4 billion to Renaissance consortium, comprising five companies, was first announced in January. Exxon's deal with Seplat Energy has awaited regulatory approval for more than two years since a $1.28 billion fee was announced in February 2022.
In a speech at an event in the capital Abuja, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) CEO Gbenga Komolafe said the Shell deal "could not scale (the) regulatory test," but did not elaborate. Exxon's transaction was granted ministerial approval.
President Bola Tinubu had signaled on October 1 that the Exxon-Seplat deal would receive ministerial approval in a matter of days after getting clearance from the regulator.
"We welcome the regulator’s announcement and look forward to formally receiving the ministerial consent as we work toward the conclusion of the sale," Exxon said in a statement.
A Shell spokesperson did not immediately respond to a request for comment.
The rejection is a blow to Shell's strategy to pivot toward deepwater for future investments and reflects the growing challenges that oil companies face in Nigeria.