Shell offshore Bonga South West Project: Nigeria approves new incentives

Tinubu’s office reported that the Nigerian president Bola Tinubu approved investment-linked incentives to Shell’s Bonga South West Deepwater Oil Project following a meeting with its chief executive.

The 'proposed incentives' are the latest of a slew of regulatory reforms that have been implemented in Africa’s leading crude oil producer in order to attract investment and boost oil production.

Tinubu, in a late-night statement on Thursday night, said that "these incentives are not concessions for all."

He said that incentives would be "ring-fenced" and will focus on new capital investment, incremental production, and strong local content delivery.

Tinubu said, "My expectation is clear: Bonga South West will reach a final investment decision within the first term of this administration."

Shell made a final investment decision on the Bonga North project in 2024, as it wished to maintain production at its Bonga Floating?Production?Storage & Offloading Facility.

Shell announced that since the start of Tinubu’s presidency in 2023, it has invested $7 billion in Bonga North, among other projects.

Olu Arowolo Verheijen is the president's energy advisor, and has been charged with finalising the incentives. He said that the visit by Shell CEO Wael Sawan, reaffirmed Shell's confidence in Nigeria for the long term.

Shell told Mr. President that it planned to invest a further $20 billion in the Bonga South West Project, she wrote on a separate LinkedIn post.

Shell did not respond to a request for comment after normal business hours. It was not able to confirm the?final investment decision on this project or to say when Shell expected to make it.

Shell bought a stake in TotalEnergies last year, increasing its share in the Bonga Oilfield to 65%. This shows its interest in offshore Nigerian production, after selling their onshore assets.

(source: Reuters)