French energy giant TotalEnergies has announced that its Nigerian subsidiary has reached an agreement to sell its non-operated 12.5% interest in the OML118 Production Sharing Contract (PSC) to Shell Nigeria Exploration and Production Company Ltd (SNEPCo). The deal, valued at $510 million, involves TotalEnergies’ stake in the deepwater Bonga oilfield, located offshore Nigeria, where Shell plans to develop another major project.
This disclosure was made in a press statement issued by TotalEnergies today, stating that the completion of the transaction is subject to customary conditions, including regulatory approvals.
Upon the deal’s finalization, Shell’s stake in the OML 118 lease is expected to increase to 67.5% from its current 55%. This move underscores Shell’s sustained interest in Nigeria’s offshore oil production, particularly after its recent sale of onshore assets to Renaissance, a consortium of local companies and an international energy group.
TotalEnergies’ Strategic Re-focus
According to TotalEnergies, the OML118 PSC is operated by SNEPCo (55%), in partnership with Esso Exploration and Production Nigeria (20%), TotalEnergies EP Nigeria (12.5%), and Nigerian Agip Exploration (12.5%). The Bonga field, located 120 km south of the Niger Delta, commenced production in 2005. The Bonga North field, also within OML 118, began development in 2024. TotalEnergies’ share of production from the OML 118 PSC, primarily oil, stood at approximately 11,000 barrels of oil equivalent per day (boe/d) in 2024.
Nicolas Terraz, President Exploration and Production at TotalEnergies, stated that the sale aligns with the French group’s strategy to “high-grade its upstream portfolio,” focusing on assets with low technical costs and emissions, and aiming to lower its cash breakeven point. “In Nigeria, the Company is focusing on its operated gas and offshore oil assets and is currently progressing the development of the Ubeta project, designed to sustain gas supply to Nigeria LNG,” he added.
TotalEnergies has maintained a presence in Nigeria for over 60 years, employing more than 1,800 people across various business segments. Nigeria remains one of the main contributing countries to TotalEnergies’ hydrocarbon production, with 209,000 boe/d produced in 2024. The company also operates an extensive distribution network, including approximately 540 service stations in the country, and emphasizes its commitment to the socio-economic development of Nigeria and collaboration with local communities.
Shell’s Expanding Offshore Investment
For its part, Shell is intensifying its focus on the Bonga field. The company announced last December its final investment decision for the development of the Bonga North deep-water project. The Bonga North project will be a subsea tie-back to the existing Shell-operated Bonga Floating Production Storage and Offloading (FPSO) facility.
Shell anticipates that Bonga North holds an estimated recoverable resource volume of over 300 million barrels of oil equivalent (boe). It is projected to reach a peak production of 110,000 barrels of oil per day (bpd), with first oil expected by the end of the decade.
Commenting on the acquisition of TotalEnergies’ stake, Peter Costello, Shell’s President, Upstream, said, “Following our final investment decision on Bonga North last year, this acquisition brings another significant investment in Nigeria deep-water that contributes to sustained liquids production and growth in our Upstream portfolio.”
