Tinubu approves production tax credit to fast-track Shell’s $20bn FID in deepwater project

President Bola Tinubu has approved a targeted fiscal incentive designed to unlock the final investment decision (FID) on the Bonga Southwest Aparo (BSWA) deepwater project.

In a statement on Tuesday, Andy Odeh, spokesperson of the Nigerian National Petroleum Company (NNPC) Limited, said the FID marks a milestone in Nigeria’s ongoing drive to attract strategic investments and accelerate sustainable economic growth.

“The project is estimated to attract about $20 billion in Foreign Direct Investment and position Nigeria for a new era of deepwater production,” the statement reads.

The approval, Odeh said, followed months of intensive technical and commercial negotiations involving NNPC as the concessionaire, the Nigeria Revenue Service (NRS), Olu Verheijen, special adviser to the president on energy, and Wael Sawan, chief executive officer (CEO) of Shell.

“It represents the culmination of the President’s directive, issued during a courtesy visit by Shell CEO, Mr. Wael Sawan, to fast-track the enablers required to move this strategic national asset to FID,” the spokesperson said.

“It signals renewed confidence in Nigeria’s policy direction and its resolve to translate reform momentum into tangible investment outcomes.”

‘FIRST FID ON NIGERIA DEEP WATER PSC SINCE 2008’

NNPC said the Bonga south-west project will be the first FID on a Nigeria deepwater production sharing (PSC) contract asset since 2008, “re-establishing Nigeria as a premier deepwater investment destination”.

“The fiscal package approved by President Tinubu includes an enhanced Production Tax Credit and resolution of the 2021 dispute settlement agreement, creating a competitive framework that balances national value with investor returns,” Odeh said.

“NNPC Limited, as concessionaire, worked closely with SNEPCo and the broader contractor party to develop alternative fiscal solutions that address structural constraints while protecting Nigeria’s long-term interests.

“The approval was granted rigorous evaluation by the National Revenue Service and submission of recommendations to the Presidency. This milestone reinforces NNPC’s strategic pivot toward partnership-driven growth.”

The spokesperson said that by partnering with global majors like Shell and securing a supportive fiscal framework, NNPC is turning the president’s investment reform agenda into concrete results, creating jobs, generating revenue, and enhancing energy security for Nigerians.

“With Presidential approval secured, NNPC Limited and its partners will now progress toward FID, triggering the multi-billion-dollar capital commitment that will transform Nigeria’s deepwater landscape and deliver enduring value to the nation,” Odeh said.

“The Bonga Southwest Aparo project, operated by Shell with all IOCs in Nigeria as partners, will create over 5,000 direct and indirect jobs, and deliver 150,000 barrels per day of crude oil and 140 million standard cubic feet per day of gas upon completion.”

OJULARI: TINUBU’S APPROVAL, A TESTAMENT TO NNPC’S DISCIPLINED EXECUTION

Speaking on the development, Bayo Ojulari, group chief executive officer (GCEO) of NNPC, said the approval is a testament to the president’s leadership, NNPC’s disciplined execution, and its ability to structure complex, bankable transactions that deliver value for Nigeria.

“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,” he said.

Ojulari said the milestone further underscores NNPC’s commitment, under the president’s leadership, to harness Nigeria’s vast energy potential through strategic partnerships, disciplined innovation, and excellence in execution. (The Cable)