By Seun Ibiyemi
The Nigerian National Petroleum Company Limited (NNPC Ltd) and partners in the OML 118 joint venture have signed key agreements expected to accelerate the development of the long-delayed Bonga Southwest/Aparo (BSWAp) deepwater project towards Final Investment Decision (FID).
The agreements include the Addendum to the OML 118 Production Sharing Contract (PSC) and the Addendum to the Dispute Settlement Agreement (DSA), executed by NNPC Ltd and the contractor parties comprising Shell Nigeria Exploration and Production Company Limited (SNEPCo), Esso Exploration and Production Nigeria (Deepwater) Limited and Nigerian Agip Exploration Limited (NAE).
The agreements give effect to fiscal and commercial terms approved by the Federal Government for the development of BSWAp, potentially unlocking one of Nigeria’s largest new deepwater oil and gas investments.
The milestone follows President Bola Ahmed Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, which forms part of the government’s efforts to improve the competitiveness of Nigeria’s deepwater sector and attract fresh investment.
BSWAp is projected to attract between $15 billion and $21 billion in investment over the life of the project, with peak production estimated at about 175,000 barrels of oil per day (bpd) and 140 million standard cubic feet of gas per day (mmscfd).
The development is expected to increase Nigeria’s oil and gas output while generating additional government revenue, foreign exchange earnings, employment and business opportunities for Nigerian companies.
Speaking on the development, NNPC Ltd Group Chief Executive Officer, Bashir Bayo Ojulari, said the execution of the agreements demonstrated the impact of the Federal Government’s reforms in converting policy measures into actual investment.
“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,” Ojulari said.
He added that NNPC would continue working with the government, partners and other stakeholders to ensure that the project delivers maximum value to the Federation and Nigerians.
The contractor parties also announced the completion of the project’s Pre-Front End Engineering Design (Pre-FEED) phase, marking further progress in maturing its technical and commercial scope.
The project is now positioned to advance into the Front End Engineering Design (FEED) phase, subject to applicable partner, assurance and governance requirements.
In another development, a bidder has been identified as the preferred contractor for the project’s Floating Production Storage and Offloading (FPSO) facility following a competitive selection process.
However, the selection remains subject to partner, regulatory, assurance and governance approvals. Any eventual award of the FPSO Engineering, Procurement, Construction and Installation contract will also require completion of all applicable approvals.
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Once operational, BSWAp is expected to become one of Nigeria’s major deepwater production hubs and contribute significantly to efforts to sustainably increase national oil production.
The project is also expected to generate opportunities for Nigerian contractors and suppliers across engineering, fabrication, offshore construction, marine services, logistics and operations.
According to NNPC, the development could strengthen Nigerian content through increased contracting opportunities for indigenous companies, local fabrication, marine and engineering capabilities, technology transfer and skills development.
The project could consequently create wider economic benefits through direct and indirect employment and increased participation of Nigerian businesses in the deepwater oil and gas value chain.
The execution of the PSC and DSA addenda marks a significant step towards resolving commercial and fiscal issues surrounding BSWAp and advancing the project towards FID.
NNPC Ltd said it would continue collaborating with the Federal Government, regulators and the OML 118 contractor parties to advance the project safely, competitively and responsibly.
