Shell plans to invest $20 billion in the Bonga South West deepwater project offshore Nigeria, the special adviser to Nigeria’s president said after the government approved investment-linked incentives for the project.
Nigerian President Bola Ahmed Tinubu has approved the adoption of targeted, investment-linked incentives to support the proposed Bonga South West deepwater offshore oil project by Shell and its partners, the office of the president said after Tinubu met with the supermajor’s chief executive, Wael Sawan.
Shell has doubled down on the Bonga oilfield after announcing at the end of 2024 the final investment decision for the development of the Bonga North deep-water project—a subsea tie-back to the Shell-operated Bonga Floating Production Storage and Offloading (FPSO) facility. Bonga North currently has an estimated recoverable resource volume of more than 300 million barrels of oil equivalent and will reach a peak production of 110,000 bpd, with first oil anticipated by the end of the decade.
However, the Bonga South West project has been stalled, which Nigeria now aims to kickstart with incentives and energy sector reforms to make investments more attractive for foreign firms.
The incentives for Bonga South West “are ring-fenced and investment-linked, focused on new capital and incremental production, strong local content delivery, and in-country value addition,” Tinubu said.
“My expectation is clear: Bonga South West must reach a Final Investment Decision within the first term of this administration.”
Since the current administration took office in 2023, Shell has invested $7 billion in Nigeria, particularly in the Bonga North and HI projects, Olu Arowolo Verheijen, the president’s special energy adviser, said.
Last year, Shell and its partner Sunlink Energies and Resources Limited took a final investment decision on the HI gas project offshore Nigeria, which will supply additional gas volumes to Nigeria LNG.
“During the Meeting Shell informed Mr President of plans to invest an additional $20 billion on the upcoming Bonga South West project,” Verheijen said on X.
Shell has not confirmed the investment amounts.
By Tsvetana Paraskova for Oilprice.com
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