The highly anticipated return of Shell to Gabon signifies a pivotal moment for the country’s petroleum sector. A decade after its initial departure, the Anglo-Dutch energy giant is poised to recommit to Gabon’s sedimentary basin. This move comes as Libreville actively seeks to counteract a continuous decline in its hydrocarbon output. The announcement, made amidst a period of significant reforms initiated since the political transition, clearly demonstrates the authorities’ intent to signal stability and opportunity to international investors.

Back in 2016, Shell had finalized its exit from Gabon by divesting its onshore assets to Assala Energy, a venture then under the control of the Carlyle fund. This multi-million dollar transaction was part of a broader global portfolio streamlining effort by the group, which at the time was concentrating on projects deemed more lucrative, particularly in liquefied natural gas and deepwater exploration. The departure of this historical oil operator had left a notable void within Gabon’s energy landscape.

A strategic signal for Gabon’s petroleum sector

The major’s re-entry occurs under the leadership of President Brice Clotaire Oligui Nguema, who assumed power following the August 2023 transition and was subsequently confirmed through elections. In recent months, Gabonese authorities have intensified their efforts to enhance the attractiveness of the upstream framework. Revisions to the hydrocarbon code, the re-launch of block allocation rounds, and bilateral discussions with several major companies underscore a comprehensive strategy aimed at reversing the trajectory of oil production, which currently hovers around 200,000 barrels per day – a considerable drop from the historical peaks of the late 1990s.

For Shell, the decision to return is far from trivial. The group, which had previously opted to shed mature assets considered less strategic, is now recalibrating its perspective on the African continent. The scarcity of major onshore discoveries, mounting pressure on ultra-deepwater exploration costs, and the ongoing search for medium-term petroleum growth drivers are reshaping the priorities of large energy corporations. Within this evolving context, the Gabonese basin, still offering promising prospects in deep offshore and around pre-salt structures, has regained a certain appeal.

Revitalizing Gabon’s declining production: Libreville’s ambition

Petroleum production remains Gabon’s primary source of foreign exchange, historically contributing over 40% of budgetary revenues and nearly 80% of exports. However, the gradual depletion of mature fields, coupled with a cautious approach to investments in recent years, has destabilized this crucial balance. The authorities are banking on the return of prominent industry players to bolster exploration efforts and extend the operational life of existing deposits.

Several international entities have already expressed renewed interest in the nation. The national company, Gabon Oil Company (GOC), is expanding its influence in asset governance as contracts mature or are renegotiated. Shell’s return could, within this framework, involve partnerships with other operators already active locally, such as Perenco, TotalEnergies, or BW Energy, all of whom have solidified their positions on offshore blocks.

Strategic return: details yet to be defined

The precise terms of the major’s redeployment still require clarification. These include the scope of the blocks involved, the engagement timeline, investment amounts, and the contractual model. The nature of the targeted permits, whether onshore or in deep waters, will largely determine the scale of this return. A significant presence in deep offshore would necessitate commitments spanning several hundred million dollars, whereas a strategy focused on mature assets might imply a more conservative approach, primarily geared towards optimizing existing production.

Beyond Shell’s specific case, the credibility of Gabon’s new oil policy is truly at stake. Libreville’s ability to translate these announcements into tangible investments, especially in a competitive environment where Nigeria, Angola, Namibia, and Senegal are actively vying for major capital, will dictate the sector’s trajectory over the coming decade. In this regard, the Anglo-Dutch company’s return represents a crucial real-world test for the new administration.