Shell Companies in Nigeria awarded $518 million in contracts to indigenous companies in 2025, underscoring its commitment to expanding local participation in Africa’s largest oil-producing economy and strengthening Nigeria’s domestic oil and gas supply chain.
The company disclosed that 123 Nigerian-owned companies participated across its operations during the year, providing engineering, technical, logistics and other specialised services throughout the energy value chain.
The figures were released in Shell’s 2025 Payments to Governments Report, highlighting the company’s continued investment in local capacity development alongside its significant fiscal contributions to the Nigerian government.
“The payments show a strong support for Nigerian service providers in our operations,” said Rohan D’Souza, Shell’s Vice President, Commercial.
“We see the development of Nigerian companies beyond compliance with laws. It is an integral part of a longstanding strategy to create a win-win relationship with indigenous companies and support them to create more value in the oil and gas industry within and outside the country.”
Expanding Local Content Capacity
Shell said its partnership with indigenous businesses extends beyond contract awards, with the company supporting local firms to improve technical capabilities, operational standards and service delivery.
The initiative aligns with Nigeria’s drive to increase indigenous participation in the petroleum industry under the country’s local content policy, which seeks to retain more value within the domestic economy while developing globally competitive energy service companies.
$3 Billion Financing Initiative for Indigenous Contractors
The contract awards come shortly after Shell Nigeria Exploration and Production Company Limited (SNEPCo) introduced a $3 billion Contract Finance Facility in collaboration with nine leading Nigerian banks.
The financing programme, available in both Naira and U.S. dollars, is designed to improve access to working capital for indigenous contractors executing Shell projects, addressing one of the major challenges facing local oilfield service companies.
The facility is expected to enhance project execution, strengthen local supplier capacity and improve the competitiveness of Nigerian companies participating in major upstream developments.
$2.02 Billion Paid to Nigerian Government
Beyond local procurement, Shell said it contributed approximately $2.016 billion to the Nigerian government in 2025 through production entitlements, royalties, taxes and statutory fees.
According to D’Souza, the company’s combined investments in local businesses and government revenues demonstrate Shell’s enduring economic contribution to Nigeria after more than six decades of operations.
“When you consider the fact that Shell also paid some $2.016 billion through production entitlements, royalties, taxes and statutory fees to the Nigerian Government in 2025 alone, you get an idea of the enduring partnership we have forged in the country since we set foot here more than 60 years ago,” he said.
Why It Matters
Shell’s procurement spending reflects the growing importance of indigenous companies in Nigeria’s energy industry at a time when international oil companies are increasingly focusing on offshore developments while encouraging greater local participation.
For investors and industry stakeholders, the company’s continued investment in Nigerian contractors is expected to support job creation, deepen domestic technical expertise, strengthen local supply chains and improve the long-term competitiveness of Nigeria’s oilfield services sector.
The latest figures also reinforce the role of local content policies in attracting investment, expanding industrial capacity and ensuring that more economic value from oil and gas operations remains within Nigeria.
