As Nigeria’s largest overseas investor, Shell is at the forefront of some of the country’s major development schemes, not only in the oil and gas industry, but also in social and environmental areas.
Initiatives by the Obasanjo government and improvements to the overall business climate have allowed the company to pursue a number of new projects along the energy chain – including expansion work to the Nigerian Liquefied Natural Gas (NLNG) plant on Bonny Island and the development of pioneering independent power projects.

‘We employ about 10,000 Nigerians’ Ronald van den Berg

But being a successful oil company also brings with it responsibilities, according to Ronald van den Berg, chairman and managing director of Shell Petroleum Development Company (SPDC), which pumps about half the country’s oil output.
He believes that while Nigeria has come a long way in a short space of time, tackling problem issues such as corruption and introducing good governance and accountability, SPDC has an important role to play in terms of investing in local people and boosting skills development.
“Shell, of all the major oil companies working in the country, has the highest percentage of Nigerians working for it, more than 95 per cent of its workforce,” he says. “We employ about 10,000 Nigerians in total, and what that represents is a lot of money going back into the community.”

Each year SPDC spends $65 million on projects such as hospitals, schools and roads

Mr van den Berg describes Shell as the largest private sector investor in social services in Africa. Every year it spends about $65 million on community development in Nigeria alone, from agriculture and hospitals to schools and roads.
It also means creating a meaningful role for Nigerian businesses within their own country’s oil and gas industry.
“We are helping ensure local content in the industry as much as possible and are even willing to pay a premium, but we cannot give contracts to companies that are not capable, either technically or financially,” says Mr van den Berg.

SPDC is responding to the government’s call to raise total oil production to four million bpd by 2010, up from two million bpd currently. By 2005, the company will be producing more than 1.5 million bpd, up from around 900,000 bpd today, as a result of annual investments worth $3 billion.
SPDC is playing a leading role in the development of the country’s deepwater and ultra-deepwater acreage with the development of the giant offshore Bonga field. Currently, most oil production is either onshore or in the shallow waters around the Niger Delta.

On top of this, it will be producing more gas, which will be earmarked for export schemes such as NLNG – in which Shell is a lead investor – and new initiatives such as gas-to-power projects. The company is in the process of adding a fourth and fifth LNG production train that will make it the second biggest plant in the world within a few years; it is also developing a couple of electricity projects that will utilise natural gas.
“We are also looking at ways to develop the internal gas market, which has enormous potential,” says Mr van den Berg. “We are working with the government to develop a masterplan. We want to give people in the Delta region an opportunity of really benefiting from their resources”