SPDC Sets out its Future Intent for Nigeria

PORT HARCOURT, Nigeria, June 21, 2013 /CNW/ - The Shell Petroleum Development 
Company of Nigeria Ltd (SPDC) as operator of the Nigerian National Petroleum 
Corporation (NNPC)/SPDC joint venture (SPDC JV) today announced that the SPDC 
JV (NNPC 55%, SPDC 30%, TOTAL 10%, NAOC 5%) has taken final investment 
decisions for the Trans Niger Pipeline loop-line (TNPL) and the Gbaran-Ubie 
Phase Two projects, both in Nigeria's eastern Niger Delta. The total capital 
investment for the two bundles of projects is around $3.9 billion. SPDC has 
also announced today a strategic review of the interests that it holds in 
selected onshore leases in the SPDC JV. 
SPDC Managing Director, Mutiu Sunmonu said: "Today's announcements demonstrate 
our long term commitment to Nigeria by clearly signaling our intent for the 
strategic direction of Shell in Nigeria." 
New investment inNigeriaoil and gas 
The Trans Niger Pipeline (TNP) is important for Nigeria, pumping some 180,000 
barrels per day of crude oil to the Bonny Export Terminal and is part of the 
gas liquids evacuation infrastructure, critical for continued domestic power 
generation (Afam VI power plant) and liquefied gas exports. 
Sections of the TNP have been heavily impacted by sabotage and crude oil 
theft. The design of the TNPL includes improvements which make the pipeline 
better protected against crude oil theft and sabotage, which should help to 
reduce pollution related to criminal activity which was a key aspect of a 2011 
United Nations Environment Programme (UNEP) report on Ogoniland. The total 
capital investment for the TNPL project bundle is expected to be $1.5 billion. 
The Gbaran-Ubie Phase Two project consists of five gas supply and 
infrastructure projects which are critical for the continued gas supply to the 
Nigeria Liquefied Natural Gas (NLNG) plant and the Gbaran-Ubie domestic power 
plant (IPP). The total investment for the Gbaran-Ubie Phase Two bundle is $2.4 
billion. The expected peak production from these projects is 215 kboe per day 
Mutiu Sunmonu commented: "These investments will help to secure energy 
supplies for domestic and international markets. The TNPL project 
demonstrates the tangible steps SPDC and its partners are taking to tackle the 
scourge of criminal activity - pipeline sabotage and crude theft in the Niger 
Delta, which is the cause of so much environmental and economic damage in this 
Strategic review of SPDC interests in selected onshore leases 
Today, Shell's 100%-owned subsidiary, SPDC, announced the initiation of a 
strategic review, consultation with partners, and the potential exit from the 
interests it holds in some further onshore leases in the Eastern part of the 
Niger Delta, subject to partner and regulatory approvals. The SPDC JV produced 
around 750 kboe per day of oil and gas in 2012 from 28 Oil Mining Licenses 
(OMLs) across the Niger Delta, both onshore and in the near offshore. SPDC has 
been following a strategy of selective divestments of its onshore portfolio, 
concentrating the operating footprint into a smaller, more contiguous area, 
while supporting the Government's policy of encouraging investment by 
indigenous companies in the Nigerian oil and gas industry. Since 2010, SPDC 
has sold its interest in eight OMLs for a total of $1.8 billion. 
Mutiu Sunmonu further commented: "Nigeria remains an important part of Shell's 
portfolio, with clear growth potential, particularly in deepwater and onshore 
gas. This strategic review marks another step in re-focusing the SPDC 
Notes for editors 
The Shell Petroleum Development Company of Nigeria Ltd (SPDC) is the operator 
of an unincorporated joint venture (SPDC JV) with the Nigerian state oil 
company NNPC, Total E&P Nigeria Limited ("TOTAL") and Nigerian AGIP Oil 
Company Limited ("NAOC"). 
TNPL is proposed to be executed by three indigenous contractors who have grown 
steadily over the past five years from medium sized companies to big players 
in the industry. The construction of the Gbaran-Ubie Phase Two project 
includes local and international companies. The estimated Nigerian Content 
value in terms of in-country manpower, goods and services that will be 
utilized in the execution of these projects is over 66%. 
The social and economic benefits to the local communities are substantial. 
Aside from direct employment, many of the sub contractors will come from the 
local communities in line with the JV partners' local content commitment to 
develop capabilities within the Niger Delta region. There will also be direct 
social investment in skills growth and direct investment via the Global 
Memorandum of Understanding (GMOU) model. 
Figures for oil & gas production and capital investment in this press release 
are shown on a 100% joint venture basis. 
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SOURCE: Royal Dutch Shell PLC 
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