Distruption of local communities key factor of divestment

By Uthman Salami

TotalEnergies has attributed the disruption of local communities as one of key reasons it is joining the other international oil companies to sell its stake in an onshore oil production joint venture in Nigeria.

The planned divestment of TotalEnergies is the latest in a series of similar actions by other International Oil Companies (IOCs) like Shell and ExxonMobil had announced plans to divest from their Nigerian oil assets months ago.

The revelation of the company’s plan to divest was conveyed by the  Chief Executive Officer of Total Energies, Patrick Pouyanne during an earnings conference call last week where he said the company would put up for sale its 10per cent interest in a company operating 20 licenses onshore Nigeria.

According to Bloomberg, Pouyanne said, “Disruption of local communities are sources of great concerns.’’

The licenses are being operated by another supermajor, Shell, which is also looking to divest Nigerian assets as it has been reported that it was already considering bids from four indigenous oil firms for its 30per cent shareholding of the joint venture.

In what many had described as worrisome, oil majors have for over a decade been selling their onshore and shallow water assets to Nigerian independent producers.

Many stakeholders in the industry have attributed the divestments of these companies to the changing trend in the sector as investors are now targeting environmental driven oil solutions especially in respect of zero carbon emissions.