Shell, NNPC Set to Sanction $20bn Bonga Southwest Project After Tinubu’s Nod

President Bola Ahmed Tinubu has approved a targeted fiscal incentive package to unlock the long-awaited Final Investment Decision (FID) on the Bonga Southwest Aparo (BSWA) deepwater project, paving the way for a $20 billion investment that could reshape Nigeria’s offshore oil and gas landscape.

The approval clears a major hurdle for the BSWA development, which has been stalled for nearly two decades, and marks a key milestone in the administration’s drive to attract large-scale foreign direct investment and boost sustainable economic growth. The project is expected to position Nigeria for a new era of deepwater production, with first oil projected at 150,000 barrels of crude per day and gas output of 140 million standard cubic feet per day, the Nigerian National Petroleum Company (NNPC) said on Tuesday.

The fiscal package endorsed by the President includes an enhanced Production Tax Credit and resolution of issues arising from a 2021 dispute settlement agreement, creating what officials describe as a more competitive and balanced regime for both Nigeria and investors. The framework is designed to restore Nigeria’s appeal as a premier deepwater destination and to support bankable, long-term investments in the sector.

The approval followed months of intensive technical and commercial negotiations involving NNPC as concessionaire, the Nigeria Revenue Service (NRS), the Special Adviser to the President on Energy, Olu Verheijen, and Shell’s global chief executive, Wael Sawan. It also fulfils Tinubu’s directive, issued during Sawan’s courtesy visit to the State House, to fast-track all enablers required to move the BSWA project to FID.

Group Chief Executive Officer of NNPC, Bayo Ojulari, described the President’s sign-off as a turning point for both the project and Nigeria’s investment narrative.

“This approval is a testament to the President’s leadership, NNPC’s disciplined execution and our ability to structure complex, bankable transactions that deliver value for Nigeria,” Ojulari said. “For nearly two decades, the Bonga Southwest project remained stalled. Today, under President Tinubu’s reform-driven leadership and through NNPC’s sustained advocacy, we have broken that logjam. This is what partnership, persistence, and policy clarity can achieve.”

Ojulari added that the development underscores NNPC’s broader strategic direction under the current administration. “This milestone further affirms NNPC’s commitment, under the President’s leadership, to unlocking Nigeria’s vast energy potential through partnerships, disciplined innovation and execution excellence,” he said.

The BSWA project is set to become the first FID on a Nigerian deepwater Production Sharing Contract (PSC) asset since 2008, a gap that had raised concerns about the competitiveness of the country’s offshore fiscal and regulatory environment. Officials say the newly approved package reflects lessons from that period and addresses long-standing structural constraints that had discouraged major players.

As concessionaire, NNPC worked closely with Shell Nigeria Exploration and Production Company and the broader contractor parties to design alternative fiscal solutions tailored to deepwater realities while safeguarding Nigeria’s long-term interests. The proposals were subjected to rigorous assessment by the National Revenue Service before being forwarded with recommendations to the Presidency.