‘Shell’s Bonga North Project to Unlock Nigeria Deepwater Potential, Create Local Content Opportunities’ – Ronald Adams

In this interview, Ndubuisi Micheal Obineme, Managing Editor of The Energy Republic, talks to Ronald Adams, Managing Director of Shell Nigeria Exploration and Production Company, SNEPCO, about the potential of Shell’s Bonga North deep-water project, and its impact on the Nigerian oil and gas industry coupled with the opportunities the project will create in contributing to the Nigerian Content growth.

In October 2024, Adams was appointed as the new Managing Director of Shell’s deep-water subsidiary in Nigeria – SNEPCo. Adams replaces Elohor Aiboni, who is moving to an international role as Asset Director at Brunei Shell Petroleum (BSP). Excerpts:

Please briefly tell us about your career journey and professional activities in the energy sector.

Adams: I’m a chemical engineer by background and took an MBA with a specialization in Strategic Planning from Herriot-Watt University, Edinburgh School of Business.

I’ve been around for a while, having spent more than 30 years across the upstream, midstream, and downstream sectors of the energy industry.

I’ve held leadership positions in general management, operations, engineering, and business development in organizations in Trinidad and North America.

I joined Shell Trinidad and Tobago Limited in 2019 and was appointed Managing Director of Atlantic LNG of Trinidad and Tobago in August 2021, the first local to hold the position in its 25 years of operation.

Incidentally, I took over from a Nigerian, Dr Philip Mshelbila.

Today, I’m in Nigeria!

TER: Welcome to Nigeria Ronald Adams. What was your first impression when you first arrived in Nigeria? Any surprises? And how has been your experience working in Nigeria as SNEPCO’s Managing Director so far?

Adams: Interestingly, Nigeria, for me, is home and I’m not making it up! My first impression on arriving here? It’s one word: People! This is a big deal considering that I come from a country of less than 2 million people. And, then when I got to work and met colleagues, I could see an amazing array of individual and collective brilliance; Nigerian talent working for Nigeria. Great people working for a great company and powering lives in a great country! That’s my overall impression from my time here so far.

TER: Your appointment as SNEPCO Managing Director is coming at a time when Shell finalized the FID on the Bonga North deep-water project. How would you evaluate the potential of the Bonga North project?

Adams: The Bonga North project further consolidates the successes of Bonga and will deliver significant value to all stakeholders. We plan for the project to sustain our deepwater oil and gas production, ensuring that the capacity of the Bonga FPSO remains fully maximized.

We took FID on Bonga North in December 2024 and are currently executing the project towards first oil, but beyond the significant hydrocarbon potential of Bonga North, what I see is an important growth opportunity, not just for Shell in Nigeria but for Nigeria as a country and for the Nigerian service industry.

This will hopefully be the first of many investment decisions in the country that will unlock the significant potential of the offshore basin.

I’m also seeing the significant opportunity for Nigerian content and Nigerian professionals and contractors.

I see a further development of 21st-century deep-water engineers that will lead Nigeria through its production aspiration and economic prosperity.

And, in all, I see Shell continuing to be a force for good, working with its government and co-venture partners to power progress and bring value to all stakeholders.

I see impressive milestones ahead beyond our one billionth barrel production milestone recorded in February 2023.

So, Bonga North promises to be a game-changer and I can’t wait to see the project produce its first oil.

TER: What are the challenges SNEPCO encountered and lessons learned during the development process of the Bonga North project?

Adams: The oil and gas business is challenging by itself. You are dealing with a resource underground, and it takes several studies to confidently identify potential and convince investors to commit to the project.

Bonga North was not different. The lessons are clear: careful planning, excellent stakeholder management, and smart decision-making underpinned by Shell’s core values of honesty, integrity, and respect for people.

The forward-thinking character of Shell and its renowned global expertise in hydrocarbon exploration and production came in handy to put us over and above the usual and unusual challenges on the path to FID.

TER: In what ways will the Bonga North project impact the Nigerian oil and gas industry?

Adams: Bonga North currently has an estimated recoverable resource volume of more than 300 million barrels of oil equivalent (boe) and will reach a peak production of 110,000 barrels of oil a day.

No doubt, this will be a boost to Nigeria’s overall oil output.

I believe the project also inspires confidence in foreign investors who are eyeing opportunities in the energy industry in Nigeria.

TER: What advice do you have for potential investors looking to invest in Nigeria?

Adams: Clear-headed thinking, determination, patience, and alignment with the dreams and aspirations of your hosts would be my advice to potential investors.

TER: What should Nigeria do to drive more investment and project development?

Adams: Investors generally look for a stable polity, favorable fiscals, predictable regulatory frameworks, and a secure business environment with the right infrastructure and amenities. These are the basics anyone would consider before commiƫing their money and time in any viable investment opportunity.

TER: In what ways SNEPCo is planning to boost Nigerian Content development going forward?

Adams: Today, some 97% of the SNEPCo workforce are Nigerian, and overall, Bonga has helped to create a new generation of Nigerian deep-water professionals. Our efforts have helped to develop indigenous manpower for deep-water operations in Nigeria.

The Bonga success story has been led by Nigerians who have been managing directors of SNEPCo since it was established in 1993.

I’m the only exception in more than 30 years of its operations!

We also continue to make good progress in contract awards to Nigerian businesses.

In 2023 alone, SNEPCo together with two of our sister companies, The Shell Petroleum Development Company of Nigeria Limited and Shell Nigeria Gas awarded $1.98 billion in contracts to Nigeria-registered companies. This is a 3% increase in value from the previous year.

We, similarly, continue to work with the NCDMB on human capital development (HCD) and other capacity development initiatives which shall grow in-country capacity in geosciences, marine, logistics, fabrication, IT, and more.

We don’t just deal with contractors. We also invest in the future of our young ones through secondary school and undergraduate scholarship programmes that have helped hundreds of people across Nigeria.

SNEPCo realizes that the best investment in the future of our business is supporting Nigerians (individuals and businesses) to improve their potential.

TER: In the fourth quarter of 2024, Shell won its appeal against a landmark climate litigation that started in 2021 mandating the company to cut its carbon emissions by 45% by 2030. The Dutch Appeal Court in the Hague reversed the decision of the trial court on Tuesday 12th November 2024, stating that while Shell is required to reduce its emissions, “there is currently insufficient agreement on a specific reduction percentage that an individual company such as Shell should adhere to. The case against Shell, therefore, was dismissed entirely.” Following this development, please could you shed more light on the Shell Energy Transition Strategy, with emphasis on the impact on SNEPCO’s operations in the Nigerian offshore oil and gas industry?

Adams: Shell aims to become a net-zero emissions energy business by 2050, and between 2023 and the end of 2025, we’re investing some $ 10 billion to 15 billion in low-carbon energy solutions globally. It shows that Shell is a significant investor in the energy transition.

Overall, we believe that smart policies from governments, along with investment and action across all sectors, will drive the progress towards net-zero emissions.

Shell believes that, while the world still relies on oil for secure energy, we will help produce it with lower emissions.

At SNEPCo we’re determined to deliver value to stakeholders and at the same time, further reduce or eliminate carbon emissions from our operaƟons at a time of heightened concerns on climate warming.

We target efficient engines and turbines while addressing obsolescence and deploy excellent operational discipline in reducing our flares.

Our new Lagos office is also Edge Certified for energy efficiency.

But let me add that the energy transition in Nigeria as elsewhere is rightly the collective effort of industry, government, and society.

TER: How integrated is SNEPCO’s ESG strategy and its impact, especially on communities?

Adams: Our ESG strategy is anchored on our core values of honesty, integrity, and respect for people. We aim to operate responsibly, contributing to the development of Nigeria through the energy we produce and impacting lives directly through our social investments.

To give you an idea, our wide-ranging social investment porƞolio has improved lives and changed people’s stories – from internally displaced persons camps to hospital wards and educational institutions, SNEPCo’s intervention is helping people to rebuild their lives, enhancing treatment and care for cancer patients and supporting students to achieve their educational dreams.

Shell is in Nigeria for the long haul and will continue to contribute to the development of the country through our operations.

TER: What’s your perspective on the global energy transition agenda and how can it be structured to meet the growing energy demand, especially in developing nations?

Adams: The developing world, especially Nigeria faces a dilemma. We require more energy due to our population growth, industrialization, and economic goals while the world is talking about transitioning from oil and gas.

We need to take urgent steps to optimize investments in oil and gas while concurrently exploring renewable opportunities like solar and hydro to help meet the energy demand of a rising population.

Shell already does this even in Nigeria with our All-On and Daystar businesses. Investing in renewable energy can reduce dependence on imported fossil fuels and enhance energy security.

Thankfully, Nigeria has abundant renewable energy resources like solar, wind, and hydropower, which, if harnessed effectively, can provide a reliable and sustainable energy supply.

TER: SNEPCO is a major sponsor at PETAN’s Sub-Saharan Africa International Exhibition and Conference, SAIPEC. How important is SAIPEC to Shell Nigeria? What will SNEPCO showcase at this year’s SAIPEC event in Lagos?

Adams: SAIPEC is a key industry event we’re proud to sponsor, and the conference host, PETAN, is our partner in the development of Nigerian content. We value the opportunity for industry and government officials to interact and exchange ideas for the good of the country.

As usual, SNEPCo will mount a high-profile exhibition showcasing the technical and non-technical sides of our business while some of our staff will also participate in the strategic sessions.

TER: You will be speaking at the SAIPEC event as well. What will be your major talking point?

Adams: I look forward to sharing Shell’s vision for the Deepwater business in Nigeria and how all stakeholders can come together to responsibly unlock the enormous potential in the basin.