Tinubu Approves Fiscal Incentives for Shell’s Bonga South-West Aparo Deepwater Project

Nigeria is moving closer to a new phase of deepwater oil production after President Bola Ahmed Tinubu approved targeted fiscal incentives aimed at unlocking the long-awaited final investment decision (FID) on the Bonga South-West Aparo deepwater project.

The approval, announced by Nigerian National Petroleum Company Limited (NNPC Ltd), is expected to accelerate one of the country’s most significant offshore oil developments and attract an estimated $22 billion in foreign direct investment.

According to a statement issued by NNPC Ltd’s Chief Corporate Communications Officer, the decision marks a major milestone in Nigeria’s push to restore investor confidence in its oil and gas sector while boosting long-term economic growth.

The project will be developed in partnership with Shell plc, a long-standing operator in Nigeria’s deepwater fields. The incentives were approved following months of intensive negotiations involving NNPC Ltd as concessionaire, the Federal Inland Revenue Service, and the Office of the President’s Special Adviser on Energy.

Strategic Push for Final Investment Decision

The Bonga South-West Aparo project has remained stalled for years due to uncertain fiscal terms, rising project costs, and global investment competition. Analysts say the newly approved incentives are designed to address those concerns and make the project commercially viable.

President Tinubu had earlier directed energy stakeholders to fast-track policy and regulatory enablers necessary to bring the strategic asset to the final investment decision stage.

Officials say the latest move reflects the administration’s broader strategy to revive Nigeria’s upstream sector, particularly deepwater exploration where major international oil companies remain active despite divestments from onshore assets.

NNPC: A Turning Point for Nigeria’s Energy Sector

Group Chief Executive Officer of NNPC Ltd, Mele Kyari, described the approval as a strong signal of leadership and commitment to energy sector reform.

He said the decision demonstrates the federal government’s determination to create an investor-friendly environment capable of unlocking major oil and gas projects that have been delayed for years.

Industry observers believe the Bonga South-West Aparo development could significantly increase Nigeria’s deepwater output. It would complement production from the existing Bonga Oil Field, which remains one of the country’s largest offshore facilities.

Economic and Production Impact

Once operational, the project is expected to generate billions of dollars in new investment inflows. Additionally, to increase Nigeria’s offshore crude production capacity, strengthen government revenues from petroleum exports and create jobs and expand local content participation in the oil sector.

Energy analysts also see the move as part of a broader effort by the Tinubu administration to restore Nigeria’s competitiveness in global energy investment, particularly as other oil-producing countries continue to attract large-scale upstream capital.