Nigerian billionaire Tony Elumelu has secured a major foothold in the oil and gas sector with the acquisition of Oil Mining Lease (OML) 17 from Shell, Total, and Eni for $803 million—a deal that reshapes Nigeria’s energy landscape.
On Friday, January 15, 2021, Shell Petroleum Development Company of Nigeria Limited (SPDC) announced it had completed the sale of its 30% interest in OML 17 to TNOG Oil and Gas Limited, a firm controlled by Heirs Holdings and Transnational Corporation of Nigeria Plc (Transcorp)—both chaired by Elumelu—for $533 million.
Additionally, Total sold its 10% stake for $180 million, while Eni offloaded its remaining 5% for $90 million, bringing the total transaction value to $803 million.
The acquisition of SPDC’s 30% stake came with an initial payment of $453 million, with the remaining $80 million structured as deferred payments. Separately, the acquisition of Total’s 10% stake involved an initial payment of $150 million, with the balance structured over time.
This deal significantly bolsters Elumelu’s energy portfolio, which already includes two thermal power plants and two hydrocarbon acreages.
Elumelu’s Unfinished Quest for Shell’s OML 11
While the acquisition of OML 17 marks a major victory, OML 11—the more valuable asset—remains out of Elumelu’s grasp.
Initially, Shell intended to sell both OML 11 and OML 17 in a package deal, demanding $1.2 billion as far back as late 2016. However, regulatory complications derailed the sale of OML 11.
In 2017, Shell included both blocks in a renewal application for 17 oil acreages, but Nigeria’s Department of Petroleum Resources (DPR), citing regulatory constraints on the size of OML 11, recommended splitting it into three smaller blocks and granting Shell operatorship over just one.
The final decision, however, came from President Muhammadu Buhari, who completely withdrew OML 11 from Shell’s control, significantly reducing the appeal of the overall sale package.
Without OML 11, OML 17 was left as the less lucrative asset, yet Elumelu pushed forward with the acquisition, recognizing its potential as a steady cash-generating engine.
What Elumelu’s $803 Million Buys Him in OML 17
Located north of Port Harcourt, OML 17 contains some of Shell’s most established fields, including:
•Agbada
•Obigbo
•Obigbo North
•Otamini
•Umuchem
The block currently produces 20,000 barrels of oil per day (BOPD) but has facilities capable of outputting up to 150,000 BOPD. It also has gas production of less than 50 million standard cubic feet per day (MMscf/d).
This acquisition provides immediate cash flow, allowing TNOG Oil and Gas to generate revenue from day one.
However, Shell retained its interest in the Port Harcourt and Residential Areas, which fall within the lease boundaries, signaling that the oil giant still sees long-term strategic value in parts of the block.
A Strategic Move to Dominate Nigeria’s Energy Sector
For Tony Elumelu, the acquisition of OML 17 aligns with his broader vision of building an integrated energy empire.
His expanding portfolio already includes:
•Afam Power Plc & Ughelli Power Plc – Two thermal power plants.
•33 – One hydrocarbon acreages.
Adding OML 17 gives Elumelu a fully operational upstream asset, positioning him as a dominant force in both power generation and oil exploration.
Though Shell’s original asking price was $1.2 billion, the final $803 million deal remains one of Nigeria’s largest energy transactions in recent years. It also demonstrates Elumelu’s determination to grow his influence in Nigeria’s oil and gas industry—despite missing out on OML 11.
With this acquisition, Tony Elumelu takes another bold step toward cementing his legacy as one of Africa’s most strategic energy investors.
