Tinubu approves fiscal incentive to unlock $20 bn bonga deep water project
Kola Oyelere Kano
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President Bola Ahmed Tinubu has approved a targeted fiscal incentive aimed at unlocking the long-awaited Final Investment Decision (FID) for the Bonga Southwest Aparo (BSWA) deepwater project, a move expected to attract about $20 billion in Foreign Direct Investment into Nigeria’s oil and gas sector.
The approval followed months of technical and commercial negotiations involving NNPC Limited, the Nigeria Revenue Service, the President’s Special Adviser on Energy, Olu Verheijen, and the Chief Executive Officer of Shell plc, Wael Sawan.
According to a statement issued in Abuja on Tuesday by the Chief Corporate Communications Officer of NNPC Limited, Andy Odeh, the approval marks a significant step in Nigeria’s efforts to attract strategic investments and boost sustainable economic growth.
The statement explained that the decision also followed the President’s directive during a courtesy visit by Shell’s CEO to fast-track the enabling conditions needed to move the project to its final investment stage.
Group Chief Executive Officer of NNPC Limited, Bashir Bayo Ojulari, described the approval as a reflection of the administration’s commitment to unlocking Nigeria’s energy potential.
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“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.
He noted that the Bonga Southwest project had remained stalled for nearly two decades but has now gained momentum under the government’s reform-driven approach.
The project will be the first Final Investment Decision on a Nigerian deepwater Production Sharing Contract asset since 2008, a development expected to strengthen the country’s position as a major destination for deep water oil investments.
Under the approved fiscal framework, the government introduced an enhanced Production Tax Credit and resolved issues related to the 2021 dispute settlement agreement, creating what officials described as a competitive investment environment that balances national revenue with investor returns.
NNPC Limited, as concessionaire, worked closely with Shell Nigeria Exploration and Production Company (SNEPCo) and other partners to design fiscal solutions that address structural challenges while safeguarding Nigeria’s long-term interests.
The Bonga Southwest Aparo project, which will be operated by Shell alongside other international oil companies operating in Nigeria, is expected to create more than 5,000 direct and indirect jobs.
Upon completion, the project is projected to produce about 150,000 barrels of crude oil per day and 140 million standard cubic feet of gas daily, contributing significantly to Nigeria’s energy security and revenue generation.