Shell sells $737m of Nigerian upstream oil assets

Royal Dutch Shell has sold off a portion of its upstream assets in Nigeria for $737m cash to local operator Eroton Exploration & Production.

Shell, which last year said it lost nearly $1bn from the rampant oil theft and sabotage in Nigeria, offloaded its 30% interest in oil mining lease 18 and related facilities in the Eastern Niger Delta.

The oil mining lease covers an area of 1,035 square kilometres and includes the Alakiri, Cawthorne Channel, Krakama, and Buguma Creek fields and related facilities, which produced on average around 14,000 barrels of oil equivalent per day during 2014.

The Anglo Dutch oil giant said the divestment was part of a strategic review of the onshore portfolio of its Shell Petroleum Development Company subsidiary.

Although Nigeria accounts for almost 10% of the group's output, the local government has proposed legislation that has had curbed investment, Shell said last year, hindering production, while oil theft was "very material".

Shell has operated in Nigeria for more than 50 years and stressed that it remained committed to keeping a long-term presence in the country, both onshore and offshore.

Related facilities sold along with the licence include flow stations and their associated gas infrastructure, as well as oil and gas pipelines.