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AFP: Shell restructures its Nigerian operations in order to cut costs

LAGOS (AFP) — Anglo-Dutch oil group Shell has restructured its upstream operations in Nigeria to promote effficiency, productivity and cut costs, a company statement said Wednesday.

It said subsidiaries like Shell Production and Development Company Limited, Shell exploration and Production Africa Limited and Shell Nigeria Exploration and Production Company Limited had been merged into one.

“The One Shell project seeks to eliminate duplication of the activities of its subsidiaries,” Shell said.

Managing director Basil Omiyi said apart from the support services that would be shared among the three subsidiaries, there would be one umbrella organisation for production, development and projects.

“We are operating in an extremely difficult enviornment where levels of production have been severely curtailed by the security situation for some time,” he said.

“Under these circumstances, we must take action in order to reduce costs, increase efficiencies and maintain a robust upstream business in the interests of both Shell, our partners and Nigeria in general,” he added.

Shell is Nigeria’s largest operator, accounting for around half of the country’s daily output of 2.6 million barrels at peak production, but the unrest in the restive Niger Delta has reduced the firm’s production by 477,000 bpd.

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