By Charles Ebi
President Bola Ahmed Tinubu has approved the gazetting of targeted, investment-linked incentives aimed at unlocking fresh capital, jobs and foreign exchange inflows from Shell’s proposed Bonga South West deep-offshore project and other deep water developments.
The President gave the directive while receiving a Shell delegation led by its Global Chief Executive Officer, Wael Sawan, and mandated the Special Adviser to the President on Energy, Mrs. Olu Verheijen, to facilitate the gazette in line with Nigeria’s existing legal and fiscal frameworks.
According to the President’s Special Adviser on Media and Public Communication, Mr Sunday Dare, the approved incentives are “disciplined, targeted, and globally competitive”, designed to attract new capital without undermining government revenues.
“These incentives are not blanket concessions. They are ring-fenced and investment-linked, focused on new capital and incremental production, strong local content delivery, and in-country value addition. My expectation is clear: Bonga Southwest must reach a Final Investment Decision within the first term of this administration”.
The Bonga Southwest project, located approximately 120 kilometres offshore Nigeria in water depths exceeding 1,000 metres, has been stalled for over a decade due to fiscal disagreements between the Federal Government and Shell Nigeria Exploration and Production Company and its joint venture partners.
The project, estimated to cost over $5 billion, is expected to produce about 150,000 barrels of oil per day at peak capacity and holds significant potential for gas production, experts say.
Previous administrations struggled to reach an agreement with Shell on the fiscal terms for the project, with the oil giant seeking incentives to make the capital-intensive deep-water development commercially viable amid declining global oil prices and Nigeria’s challenging investment climate.
President Tinubu directed his Special Adviser on Energy, Olu Verheijen, to facilitate the gazetting of the incentives in line with Nigeria’s existing legal and fiscal frameworks, including the Petroleum Industry Act 2021.
The President emphasised the strategic importance of the project to Nigeria’s economy, noting its potential to create thousands of direct and indirect jobs, generate significant foreign exchange inflows, and deliver sustained government revenues over its lifespan.
He added that the project would deepen Nigerian participation in offshore engineering, fabrication, logistics, and energy services. Tinubu reaffirmed his administration’s commitment to policy stability, regulatory certainty, and speed, noting that these reforms are critical to restoring investor confidence and positioning Nigeria as a preferred destination for large-scale energy investment.
He revealed that Shell and its partners have invested nearly $7bn in Nigeria in the past 13 months, particularly in the Bonga North and HI projects, describing this as evidence that the country’s economic and energy-sector reforms are yielding results.
He said investments in Bonga North and HI showed that Nigeria’s economic and energy-sector reforms were yielding positive results.
In 2019, following the execution of the Heads of Terms ,HoT, by the Nigerian National Petroleum Corporation ,NNPC, Shell Nigeria Exploration and Production Company ,SNEPCo, invited interested bidders for one of its oilfields.
SNEPCo subsequently announced the release of an Invitation to Tender ,ITT, to contractors for the development of the Bonga South West Aparo ,BSWA, oil field.
The Bonga South West/Aparo project was estimated to cost around $10 billion, with first oil initially expected between 2021 and 2022, and an anticipated production capacity of 225,000 barrels per day to Nigeria’s crude oil output.
In 2024, Shell announced its plan to extend the operational lifespan of its Bonga Floating, Production, Storage, Offloading ,FPSO, vessel by an additional 15 years.
In 2025, SNEPCo, a subsidiary of Shell plc, in partnership with Sunlink Energies and Resources Limited, announced the final investment decision ,FID, on the HI Gas Project offshore Nigeria.
A statement by Shell said that, upon completion, the project will deliver 350 million standard cubic feet of gas per day equivalent to about 60,000 barrels of oil equivalent at peak production to Nigeria LNG ,NLNG, in which Shell holds a 25.6% interest.
Shell took a final investment decision on the Bonga North project in December 2024 and recently increased its stake in the Bonga field, consistent with the company’s intention to be a continued disciplined investor in Nigeria’s energy sector through its Deep Water and Integrated Gas businesses.
Responding, Shell CEO Wael Sawan said Nigeria’s investment climate has improved remarkably under the Tinubu administration, adding that the company is increasingly confident in Nigeria as a destination for long-term investment.
The Bonga field, operated by Shell, commenced production in 2005 and was Nigeria’s first deep-water development.
