Nigeria’s President Bola Tinubu approved targeted incentives to fast-track the Bonga South West oil project operated by Shell. The decision was announced during a meeting in Abuja with a Shell delegation led by Chief Executive Officer Wael Sawan. Tinubu said the measures apply only to selected projects and do not amount to sector-wide incentives.
The incentives depend on fresh investment commitments and a clear increase in production. They are intended to support a project with the capacity to produce up to 150,000 barrels of oil per day, alongside substantial gas resources.
Final investment decision and project overview
The government aims to secure a final investment decision on Bonga South West before the end of Tinubu’s first term. Officials consider this necessary to restore investor confidence and improve the competitiveness of Nigeria’s offshore sector. Although the specific incentives were not disclosed, authorities said they would be applied within the existing legal and tax framework, including the Petroleum Industry Act.
Bonga South West is located roughly 120 kilometers offshore Nigeria, in waters exceeding 1,000 meters in depth, and is expected to require investment of more than $5 billion. The project ranks among the largest deepwater developments currently under consideration in the country.
Strategic importance and production outlook
For the current administration, the project has clear strategic importance. Officials associate it with job creation, increased foreign exchange inflows, and long-term government revenue. The development is also expected to increase participation by Nigerian companies in offshore engineering, fabrication, logistics, and other energy-related services.
Nigeria’s oil production has remained below official targets, with output fluctuating between 1.38 million and 1.53 million barrels per day. Authorities have introduced tax incentives and simplified administrative procedures to improve investment conditions and raise production.
Shell and its partners have invested nearly $7 billion in Nigeria, including funding for the Bonga North project. Other international energy companies have also revived or announced offshore developments. Bonga South West is widely regarded as a key test of Nigeria’s ability to attract large-scale deepwater investment.
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