Makinde Accuses FG of Undermining Oyo Shell Gas Project, Says $80m Already Committed
Oyo State Governor, Seyi Makinde, has accused the Federal Government of complicating the state’s proposed gas project with Shell by granting another company, Nipco, authorisation to lay pipes and supply gas, despite an existing agreement between the state government and Shell.
Makinde disclosed that Shell had already committed about $80 million to the project, adding that his administration was still engaging relevant authorities to resolve the disagreement and ensure the project moves forward.
The governor made this known during an interview while responding to questions about the progress of key projects and issues affecting his administration.
According to Makinde, the Oyo State Government had signed an agreement with Shell for the gas project before the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), reportedly granted Nipco the authority to supply gas.
He said the state government had raised concerns with the Federal Government, arguing that the decision could undermine the existing arrangement with Shell.
“We told them the state government had already signed an agreement with Shell, and the Federal Government, through the Midstream, decided to give the authority to Nipco,” Makinde said.
The governor described the development as unfair, noting that Shell had already made a substantial financial commitment to the proposed project.
“I told them this is not fair. I told them Shell had already committed about $80 million to this project, and we are still sorting that out,” he said.
Makinde explained that his administration was proposing an arrangement under which the Federal Government would allocate some local government areas to Shell to enable the company to proceed with the project.
“We are telling the Federal Government to give some local governments to Shell so that the project can move on. But we are still on it,” he added.
The governor did not identify the local government areas being proposed or provide a timeline for resolving the disagreement.
Makinde also used the discussion to raise broader concerns about economic policy uncertainty, arguing that frequent changes in government decisions made it difficult for state governments to plan and implement development programmes.
He said subnational governments operated in an economic environment where policy announcements could change unexpectedly, creating challenges for budgeting and long-term planning.
“We have been operating under an economic arrangement that you don’t know what you might get the following day,” he said.
The governor added that the uncertainty was making it difficult for state governments to manage their economies effectively, particularly when planning infrastructure projects and other development initiatives.
He also questioned the state of budget implementation, asking whether governments were still implementing outstanding and rollover projects from the 2025 budget.
Makinde further urged residents to recognise that governments have limited periods in office and should therefore make informed choices when electing political leaders.
“You know government will come and go, and that is why Oyo people should choose wisely,” he said.
The governor’s remarks highlight the ongoing efforts by the Oyo State Government to advance its proposed gas project with Shell, as well as the challenges it says it faces in securing a workable arrangement with federal authorities.
However, details of the agreement between Oyo State and Shell, the reported authorisation granted to Nipco, and the proposed allocation of local government areas were not provided in the account of the interview.