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TINUBU PRESSES SHELL FOR A FIRM DECISION ON THE BONGA PROJECT, APPROVES INCENTIVES
2 months ago
Verheijen says the president has directed her to formally gazette and legally publish the incentives. Also, to ensure they fit within existing Nigerian legal and fiscal frameworks.
This is important because it gives investors legal certainty, not just political promises.
Shell Bonga Project
President Bola Tinubu is incentivising pressing Shell to make a firm go-ahead” decision on the Bonga Southwest deepwater oil project by next year. To encourage this, the Nigerian government has approved special, project-specific incentives for the development.
What the incentives mean
Tinubu is making it clear that these incentives are not general tax holidays or blanket giveaways. They are limited strictly to the Bonga Southwest project. They are tied to real investment outcomes, such as fresh capital being injected, increased oil production and strong use of Nigerian workers, suppliers, and services (local content).
Nigeria will support the project, but only if Shell actually invests and delivers measurable benefits.
According to the president’s energy adviser, Olu Verheijen, the Bonga Southwest project would involve about $20 billion in investment by Shell and its partners. This makes it one of the largest potential offshore oil investments in Nigeria.
Shell CEO Wael Sawan told the government that Nigeria’s investment climate has improved significantly under Tinubu. He also said that Shell is becoming more confident about Nigeria as a long-term investment destination.
The presidency added that Shell has already invested around $7 billion in Nigeria in just over a year, suggesting renewed momentum after years of hesitation.
The statement lists Shell’s recent Final Investment Decisions (FIDs) to show that the company is already committing large sums in Nigeria. One is the $2bn HI gas project with Sunlink Energies to supply gas to Nigeria LNG Train 7. The other is the $5bn Bonga North deepwater oil project, targeting first oil by 2030.
This context signals that Bonga Southwest is the next major decision Nigeria wants locked in.
The project has been on the table for years, but there have been disagreements among partners. More so, it is complex, involving multiple oil blocks and partners, Shell, Eni, ExxonMobil, Chevron, Lukoil. Investors, especially ExxonMobil, have wanted clearer rules on fiscal terms, regulation, and incentives before committing.
Tinubu’s intervention is meant to remove those uncertainties.
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