Shell Petroleum Development Company (SPDC) on Wednesday confirmed its decision not to invest in the building of refineries in Nigeria.
Mr. Mike Mullier, Global Leader (Crude Trading) in SPDC, disclosed this to newsmen after presenting a paper at the ongoing Africa Energy Week in Accra, Ghana, saying Shell was no longer considering investing in crude processing.
He said the company’s downstream portfolio was already saturated thereby dashing the hope of fresh investment in Nigeria that ranks as the 6th largest oil producer in the world and first in Africa.
The SPDC official blamed the development on the low returns on such investments as African governments were regulating prices of petroleum products.
According to him, the company’s investment direction is currently focused on highly profitable areas that offer growth opportunities and adequate returns.
Mullier’s statement may have sealed hopes of visible private investment in domestic refining in Nigeria.
Shell is Nigeria’s biggest petroleum industry operator and produces nearly half of the country’s 2.5 million barrels per day.
Shell has joint venture and production sharing agreements with the Nigerian National Petroleum Corporation (NNPC).
