By Ademola Adekusibe
By Shell has agreed to sell its entire interest in the Shell Nigeria Gas Group to Nigerian energy company Vaaris Energy Limited, marking its exit from Nigeria’s domestic gas distribution business after more than two decades of supplying natural gas to industrial and commercial customers.
The agreement, announced on Tuesday, October 13, 2026, will transfer Shell’s interest in the domestic gas distribution business to Vaaris Energy, subject to regulatory conditions and approvals. The financial terms of the transaction were not disclosed.
Shell Petroleum B.V. signed the agreement covering its interest in Shell Nigeria Gas Holding B.V., established in 2019, which holds all but one of the shares in Shell Nigeria Gas Limited.
Elohor Aiboni, Shell’s country chair in Nigeria, said the business had served industrial and commercial customers in the country for more than 25 years, supported by its workforce and operational expertise.
“We believe this agreement provides a much stronger platform for the business’ next chapter under new ownership. Shell continues to focus on strategic Deepwater and Integrated Gas positions in Nigeria,” Aiboni said in a statement reported by TheCable.
Shell said the proposed sale aligns with its strategy of simplifying its portfolio and concentrating investment in areas where it believes it has competitive strengths. The company added that its continued focus in Nigeria would include deepwater oil production and integrated gas operations, including its interest in Nigeria LNG.
The transaction does not represent Shell’s complete departure from Nigeria’s oil and gas industry. Rather, it involves its domestic gas distribution business, while the company intends to retain its strategic interests in other parts of the sector.
Established in 1998, Shell Nigeria Gas distributes natural gas to industrial and commercial customers through a pipeline network covering approximately 170 kilometres across Ogun, Abia and Rivers states. The business serves more than 130 connected commercial and industrial customers, according to information published alongside the announcement.
Its operations are focused on domestic gas distribution. Shell Nigeria Gas does not engage in upstream gas production, liquefied natural gas operations or international gas trading.
Vaaris Energy Limited, the buyer, is a Nigerian energy company with interests across the oil and gas value chain and an existing operational presence in the country. The announcement did not provide detailed information about the company’s plans for the acquired business, its pipeline infrastructure or its existing customers.
Until the transaction receives the necessary approvals and is completed, Shell Nigeria Gas Group will remain part of Shell and continue operating as usual. Shell said the business would maintain service to its customers throughout the period leading up to completion.
The proposed sale comes amid continuing changes in Shell’s Nigerian portfolio. In March 2025, Shell completed the sale of its interest in the Shell Petroleum Development Company of Nigeria Limited to Renaissance Africa Energy Company Limited after receiving the required approvals from the Federal Government. Shell has nevertheless maintained other significant interests in the country, including deepwater operations and Nigeria LNG.
The latest transaction highlights an important distinction in Nigeria’s gas industry: producing gas, processing it for export and distributing it to domestic users are separate business activities. While Shell plans to retain its strategic deepwater and integrated gas positions, ownership of the distribution network serving industrial customers is set to change.
For Nigeria, the key questions will concern how the new ownership manages the existing infrastructure, maintains reliable supply to connected businesses and develops the network in the years ahead. The announcement, however, does not yet establish what changes Vaaris Energy intends to make to operations, pricing or expansion plans.
The deal’s completion will depend on the required regulatory approvals. Until then, Shell Nigeria Gas is expected to continue its existing operations, with the longer-term direction of the business to become clearer as Vaaris Energy’s plans emerge.