Nigeria is targeting between $15 billion and $21 billion in investment from the development of the Bonga Southwest/Aparo deepwater oil project, with peak production expected to reach about 175,000 barrels of crude oil per day (bpd).

The project moved closer to Final Investment Decision (FID) on Monday after the Nigerian National Petroleum Company Limited (NNPC Ltd) and the contractor parties signed addenda to the OML 118 Production Sharing Contract (PSC) and Dispute Settlement Agreement (DSA). The contractor group comprises Shell Nigeria Exploration and Production Company Limited (SNEPCo), Esso Exploration and Production Nigeria (Deepwater) Limited and Nigerian Agip Exploration Limited (NAE).

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According to NNPC, the agreements give effect to fiscal and commercial terms approved by the Federal Government and provide the necessary framework for progressing the project towards FID. When fully developed, Bonga Southwest/Aparo is expected to produce approximately 175,000 bpd of crude oil and 140 million standard cubic feet of gas per day (mmscfd) at peak capacity.

NNPC: Project Shows Impact of Tinubu’s Reforms

NNPC Group Chief Executive Officer, Bashir Ojulari, said the signing demonstrated that the Federal Government’s reforms were beginning to translate into fresh investment in Nigeria’s oil and gas sector.

“The execution of the BSWAp PSC and DSA Addenda demonstrates the effectiveness of President Tinubu’s reforms in translating policy into investment,” Ojulari said.

“This is about unlocking a major deepwater project and demonstrating that Nigeria has a competitive fiscal framework and a clear pathway for sustainable investment in its energy sector.”

He said NNPC would continue working with the Federal Government, project partners and other stakeholders to ensure that the development delivers value to Nigeria.

The progress follows President Bola Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, which was introduced to improve the attractiveness of deepwater investments.

Pre-FEED Completed, FPSO Contractor Identified

Beyond the commercial agreements, the project has also recorded technical progress, with the contractor parties completing the Pre-Front End Engineering Design (Pre-FEED) stage.

The completion of Pre-FEED is expected to pave the way for the Front End Engineering Design (FEED) phase, subject to the necessary partner, assurance and governance approvals.

A preferred contractor for the project’s Floating Production Storage and Offloading (FPSO) facility has also been identified following a competitive selection process. However, the selection remains subject to the required partner, regulatory, assurance and governance approvals.

The eventual Engineering, Procurement, Construction and Installation (EPCI) contract award will depend on the completion of these processes.

Potential Boost for Nigeria’s Oil and Gas Sector

When fully developed, Bonga Southwest/Aparo could significantly increase Nigeria’s deepwater oil production capacity and attract billions of dollars in fresh capital to the upstream sector.

The project is also expected to create opportunities for Nigerian companies in engineering, fabrication, offshore construction, logistics, marine services and other areas of the oil and gas value chain.

It could further support local content development, technology transfer and skills acquisition, while generating direct and indirect employment opportunities.

The anticipated 140 mmscfd of gas production could also contribute to domestic gas supply for Nigeria’s power generation and industrial sectors.

With the OML 118 agreements amended, Pre-FEED completed and a preferred FPSO contractor identified, Bonga Southwest/Aparo is now entering another critical phase as the partners work towards FID and eventual development of the deepwater project.