President Bola Tinubu approved a targeted fiscal incentive package to unlock the long-delayed Bonga Southwest Aparo deepwater project, which is expected to attract about $20 billion in foreign direct investment into Nigeria’s oil and gas sector.
The Nigerian National Petroleum Company Limited announced the approval on Tuesday, explaining that the decision clears the path for the long-awaited Final Investment Decision on the offshore project that has been stalled for almost two decades.
Shell Nigeria Exploration and Production Company, a subsidiary of Shell plc, operates the Bonga Southwest Aparo project alongside a consortium of international oil companies and Nigeria’s national oil company.
The project stands as one of Nigeria’s most important upstream investments in recent years and could revive deepwater exploration, which slowed due to fiscal uncertainty and global energy transition pressures.
NNPC stated that the president granted approval after months of negotiations involving key stakeholders, including the National Revenue Service, the president’s special adviser on energy Olu Verheijen, and Shell plc chief executive officer Wael Sawan.
In a statement signed by NNPC’s Chief Corporate Communications Officer Andy Odeh, the company described the decision as a major move toward rebuilding investor confidence in Nigeria’s deepwater petroleum assets.
The approved fiscal framework introduces an enhanced production tax credit and resolves the 2021 dispute settlement agreement, measures aimed at improving investment competitiveness while protecting Nigeria’s long-term revenue.
NNPC explained that stakeholders reached the approval after extensive technical and commercial discussions that addressed long-standing fiscal and contractual issues delaying the project.
The company added that the decision also fulfilled President Tinubu’s earlier directive to accelerate conditions needed to move the project toward a final investment decision following engagements with Shell’s leadership.
NNPC Group Chief Executive Officer Bayo Ojulari described the approval as a turning point for a project that had remained stalled for nearly 20 years.
He said the approval reflects the president’s leadership, NNPC’s execution strategy, and the ability to structure viable transactions that benefit Nigeria, noting that sustained advocacy and policy clarity helped break the long-standing deadlock.
Ojulari added that the milestone highlights NNPC’s commitment to unlocking Nigeria’s energy potential through partnerships, innovation, and effective execution.
He further stressed that the development reinforces the company’s dedication to advancing Nigeria’s energy resources through collaboration and operational discipline.
NNPC noted that the Bonga Southwest Aparo project will mark Nigeria’s first Final Investment Decision on a deepwater Production Sharing Contract asset since 2008, signaling renewed investor interest in offshore exploration.
The project could reshape Nigeria’s upstream sector by showing that large-scale investments remain viable despite the global shift toward cleaner energy. Once operational, it is expected to produce about 150,000 barrels of crude oil per day and 140 million standard cubic feet of gas daily, increasing national output.
The development is also projected to create more than 5,000 direct and indirect jobs across the oil and gas value chain and supports the federal government’s broader strategy to attract large-scale sector investment.
Government officials have repeatedly stated that Nigeria aims to secure over $100 billion in new oil and gas investments by 2030, particularly in deepwater exploration, gas development, and energy infrastructure.
The administration has introduced several reforms under the Petroleum Industry Act, including fiscal incentives, faster regulatory approvals, and improved contractual frameworks to strengthen Nigeria’s competitiveness among offshore petroleum regions.
Deepwater projects require large capital investments and long development timelines, making fiscal stability and policy certainty essential for investors.
Nigeria’s deepwater basins remain among Africa’s most productive, with fields such as Bonga, Erha, and Agbami contributing significantly to national oil production, although new project approvals slowed in recent years due to regulatory delays, rising costs, and shifting global investment priorities.
Located offshore in the Niger Delta, the Bonga Southwest Aparo project will build on the success of the original Bonga field, Nigeria’s first deepwater development that began production in 2005. The latest presidential approval could help reposition Nigeria as a competitive destination for deepwater investment.
source: punchng.com
African Energy Council