Nigeria is Africa’s oil giant. But over the past two years, a new phenomenon has been happening quietly in its oil industry: an exodus of international oil companies from all or parts of their operations.

On Tuesday, January 16th, Shell announced that it had agreed to sell its onshore oil production business in Nigeria. The oil giant is selling its 68-year-old Shell Petroleum Development Company of Nigeria (SPDC) to a consortium of local and international companies for at least $1.3bn. The acquiring consortium, known as Renaissance, includes Switzerland-based Petrolin and four Nigerian oil producers, ND Western, Aradel Energy, First E&P and Waltersmith.

“After decades as a pioneer in Nigeria’s energy sector, SPDC will move to its next chapter under the ownership of an experienced, ambitious Nigerian-led consortium,” said Zoë Yujnovich, Shell’s integrated gas and upstream director, in a statement.

Shell is not leaving Nigeria entirely. But the sale marks the end of an era for the company, which has been at the centre of the country’s oil industry for almost 100 years. It has been seeking an exit from the onshore business for the last three years.

Yet Shell is not alone. Equinor, a Norwegian oil firm, spent most of last year selling off its Nigerian entity. Then, in November, it finally found a buyer in a little-known local company, Chappal Energies. This move ended an over thirty-year stay in Nigeria. And there’s more.

Last September, Italy’s Eni announced it would sell its onshore subsidiary to Oando, a local company. Before that, China’s Addax sold its four oil blocs to state oil company NNPC last year. Then there’s US giant ExxonMobil’s plan to sell four onshore oilfields to Seplat, a Lagos and London dual-listed energy company, for about $1.3bn.

In almost all cases, the international oil majors are stepping back from onshore and shallow water assets. Why? Firstly, this business has been the most vulnerable to theft and vandalism for the last five years. Also, environmental concerns over spillage — and its resulting economic impact — have blighted these assets for decades. And now, oil majors believe that the hassles are no longer worth it and are turning to more profitable and less-distressed offshore assets. Nina Koch, Equinor’s senior vice president for Africa operations, termed it the company’s “strategy to optimise its international oil and gas portfolio and focus on core areas.”

However, there are bright spots to this trend. It is creating opportunities for local players to increase their market share. Those who don’t have billions of dollars in capital to invest in offshore assets can turn to these seemingly unloved assets. And for local giants like Dangote, it simply means less competition. The $20 billion refinery recently started producing diesel and aviation fuel. Nevertheless, it won’t be a walk in the park for any party. Dangote, for instance, will be under more pressure than ever. The other local players buying up these assets also have to figure out lasting solutions to problems tough enough to chase out legacy companies.

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