SHELL Petroleum Development Company (SPDC) has again refuted claims that it plans to leave Nigeria for Iraq.
The management, which at the weekend unfolded several projects being executed by the firm in the country, said that in the last three years, it had paid N2.9 trillion ($25 billion) to the Federal Government as taxes and royalties.
Chairman, Shell Companies in Nigeria, Mr. Basil Omiyi, told The Guardian at the weekend that recent media report on the oil giant’s alleged bid to quit the country were untrue because it was rather venturing into new areas, particularly in the gas sub-sector.
He said that to enable the Federal Government bail out the power sector from its woes, Shell would next month generate an additional 640 megawatts (MW) of electricity from the AFAM plant into the national grid.
Omiyi said Shell had embarked on major gas projects to meet domestic needs, especially for power plants to facilitate the country’s industrial development.
” We have invested significantly in the area of growing Nigeria’s gas capability via several projects. AFAM is one of such new projects undertaken by the SPDC-operated Nigerian National Petroleum Corporation (NNPC), Shell, Elf and Agip joint venture. It is a combined cycle power plant, which will deliver 640 megawatts of electricity to the national grid. We expect to commission it in September and anticipate that AFAM will be operating at full capacity in the first quarter of 2009. This is more than 20 per cent of the new electricity generation capacity being sought in the short-term by Mr. President. Shell remains committed to supporting government’s plans to develop power generation infrastructure. ”
With the present national power generation put at 2,500mw. Shell’s contribution will raise national output to 3,140mw.
Omiyi said that Royal Dutch Shell Chief Executive Officer (CEO) Jeroen van der Veer was misrepresented by some Nigerian media as saying that the company wanted to leave Nigeria for Iraq.
“We have been a major player here for the past 50 years and we are looking forward to making useful contributions here for the foreseeable future. I can state categorically that Shell has no plan to pull out of Nigeria, ” Omiyi said.
The Shell boss said that the context under which the statement was made was misrepresented. He stated that the firm’s presence in Nigeria had several positive impacts on the country and that its extensive operations, which range from exploration to production in onshore and offshore, and its active role in the Nigeria’s Liquefied Natural Gas (NLNG) project which recently added a sixth train with a seventh in view, to involvement in domestic gas had shown that it was expanding rather than shrinking or relocating.
He said: “In spite of the difficulties of the operating environment, we are continuously making new investments and commitments. There is significant new exploration going on and new discoveries emerging like Kolo Creek and Agatha 1x. There is the Forcados Yokri Integrated Project, Oben project, to boost domestic gas supply and our deepwater offshore flagship, the Bonga field, with a production capacity of 225,000 barrels of oil and 150 million standard cubic feet of gas per day. At the end of the day, we are looking at investment totalling billions of dollars.”
According to him, there are other flourishing Shell interests, including equity in projects such as the Erha and Abo offshore oil and gas projects operated by ExxonMobil and Agip, as well as the OK LNG.
Omiyi added that other strategic projects like the Shell JV Gbaran Ubie integrated oil and gas project would also help the company advance its programme to reduce flares and use gas for electricity generation and oil production by drilling 17 new wells.
“With all these developments, I can tell you that we have absolute faith in Nigeria to resolve any difficulties and Shell will remain here for many years to come,” he stated.
Omiyi said contrary to the perception that the on-going restructuring in the company was aimed at laying off workers, Shell’s objectives were efficiency and cost reduction in response to changes in the business environment.
He said Shell now has about 4,900 employees, along with another estimated 30,000 employed indirectly through its contractors.
The firm’s chief however admitted that the security issues in the Niger Delta had affected oil operations leading to many companies leaving the region.