Shell Companies in Nigeria paid $986 million in corporate taxes and royalties to the Federal Government of Nigeria in 2021. Out of this figure, Shell Petroleum Development Company of Nigeria, SPDC, paid $424 million while Shell Nigeria Exploration and Production Company, SNEPCo, paid $562 million).
The total taxes and royalties paid is $86 million more, compared with the $900 million in 2020.
In addition, Shell Companies spent $800 million on contracts to Nigerian-registered companies during the same period.
The figures are contained in Shell’s Nigeria Briefing Notes contained in its website. The Briefing Notes provide an overview of the activities of several Nigerian companies owned by Shell or in which Shell has an interest and they offer insight into their business ambitions, contributions to communities and the actions to prevent and clean up oil spills.
Also, the report shows that SPDC JV, in compliance with statutory requirements, paid $38.7 million in 2021 to the Niger Delta Development Commission (NDDC). SNEPCo and its co-ventures paid $23 million to the NDDC.
However, combined production from SPDC and SNEPCo (Bonga) declined to 493,000 barrels of oil equivalent, compared with 614,000 barrels of oil equivalent in 2020. The decline is said to be largely a result of divestment action and activity curtailment due to heightened security issues in the Niger Delta.
On staff employment, the companies said they directly employed 2,500 people (of whom 97% were Nigerian nationals) with more than 8,500 contractors supporting operations.
Mr. Osagie Okunbor, Country Chair of Shell Companies in Nigeria, noted in his accompanying message that while 2021 had so many success stories, including how the company was advancing its ambitions in gas distribution and deep-water exploration and production, Shell Companies in Nigeria, like other operators, suffered from a growing number of sabotage attacks on oil wells and pipelines, as well as the rising levels of crude oil theft. “This forced us to declare a force majeure on our Bonny export programme, effective March 3, 2022. Now is the time to remind ourselves of a stark reality: the theft of crude oil is also the theft of jobs and opportunity. The illegal actions of third parties are robbing Nigeria’s economy of billions of dollars and this must end”, he stated.
Despite the security challenges, Mr. Okunbor said, Shell Companies in Nigeria continue to contribute positively to the communities where they do business, including the long-standing health-care, education, enterprise development and community-led programmes. Shell also financially supported the purchase of vaccines for Nigeria through COVAX and it launched awareness-raising and vaccination campaigns.
The Shell boss disclosed that the highest concentration of direct social investment in 2021 within the Group was made in Nigeria, stressing that as a development partner with a strong belief in Nigeria, Shell will continue to support the country’s aspirations towards achieving the UN’s Sustainable Development Goals.
On Shell’s relationship with Nigeria, he said this remains strong, in spite of its announced intention to review options for its onshore Nigeria portfolio.
Okunbor declared: “We may be changing the content of our portfolio but this is because we intend to focus future investment in Nigeria on deep-water exploration and production, and expanding our gas distribution network for domestic and international customers. In 2021, the Bonga field’s oil mining lease (OML) 118 and its production sharing contract (PSC) were renewed for another 20 years. This lease underpins our deep-water operations. Its renewal opens up further opportunities for Shell in Nigeria. We also successfully launched the Shell Energy Nigeria business line to expand the gas distribution solutions being championed by SNG. I am confident that this move will extend the efforts of Shell in delivering gas for power and industrial use across the country”.
Looking ahead, he expressed the hope that the business environment would remain conducive to existing and new investors, saying he had no doubt that Nigeria, Nigerians and colleagues across Shell Companies in Nigeria will face whatever they must with the same compassion, dignity and resilience that they have always shown.
Shell is Nigeria’s oldest energy company, and is a global group of energy and petrochemicals companies with an average of 93,000 employees in more than 70 countries.
IMAGE CREDIT: shell.com.ng
