$20bn Bonga Southwest Project Nears FID as NNPC, Shell, Others Sign Key Agreements

…Development targets 175,000 barrels of oil daily  

…Preferred FPSO contractor emerges as project completes Pre-FEED

The Nigerian National Petroleum Company Limited (NNPC Ltd) and its partners in Oil Mining Lease 118 have moved the Bonga Southwest/Aparo deepwater project closer to a Final Investment Decision following the execution of key fiscal and commercial agreements.

The project, estimated to attract between $15 billion and $21 billion over its lifetime, is expected to become Nigeria’s largest deepwater development and one of its most significant new oil and gas production hubs.

NNPC Ltd signed addenda to the OML 118 Production Sharing Contract and Dispute Settlement Agreement with Shell Nigeria Exploration and Production Company Limited, Esso Exploration and Production Nigeria (Deepwater) Limited, and Nigerian Agip Exploration Limited, according to a statement on Monday.

The agreements give effect to fiscal and commercial terms approved by the Federal Government to support the Bonga Southwest/Aparo project, also known as BSWAp, and provide a clearer pathway towards FID.

The signing followed President Bola Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, introduced as part of reforms aimed at making Nigeria’s deepwater petroleum sector more competitive and attractive to investors.

At peak production, BSWAp is projected to deliver about 175,000 barrels of oil per day and 140 million standard cubic feet of gas daily.

The development is also expected to increase government revenue, foreign exchange earnings and national oil production, while creating employment and contracting opportunities for Nigerian companies across engineering, fabrication, logistics, offshore construction and operations.

Speaking at the signing, the Group Chief Executive Officer of NNPC Ltd, Bashir Bayo Ojulari, said the milestone demonstrated the impact of the Tinubu administration’s reforms on energy-sector investment.

“The execution of the BSWAp PSC and DSA Addenda demonstrates the effectiveness of President Tinubu’s reforms in translating policy into investment,” Ojulari said.

“This is about unlocking a major deepwater project and demonstrating that Nigeria has a competitive fiscal framework and a clear pathway for sustainable investment in its energy sector.”

He added that NNPC Ltd would continue working with the Federal Government, its partners and other stakeholders to ensure that the development delivers maximum value to Nigeria.

The contractor parties also announced the completion of the project’s Pre-Front End Engineering Design phase, further advancing its technical and commercial scope.

The project is now positioned to progress to the Front End Engineering Design stage, subject to the necessary partner, assurance and governance requirements.

Following a competitive selection process, a preferred contractor has also been identified for the project’s Floating Production Storage and Offloading vessel.

The selection will provide the basis for advancing the FPSO concept into FEED and undertaking the engineering and commercial work needed to move the project towards FID.

However, any final award of the FPSO Engineering, Procurement, Construction and Installation contract will remain subject to partner, regulatory, assurance and governance approvals.

Once operational, Bonga Southwest/Aparo is expected to contribute materially to Nigeria’s ambition to raise oil and gas production sustainably.

The project is also projected to deepen Nigerian content by expanding opportunities for indigenous contractors and suppliers, enhancing local fabrication, marine and engineering capabilities, and supporting skills development and technology transfer.

NNPC Ltd said the latest milestone reflected strong collaboration among the company, the Federal Government, regulatory agencies and the OML 118 contractor parties.

The national oil company reaffirmed its commitment to advancing the project safely, competitively and responsibly while maximising its economic benefits for the country.