Key takeaways:
- NNPC and partners signed addenda to the OML 118 contract, advancing Bonga Southwest/Aparo toward FID
- The project could draw $15-21 billion in investment, with peak output of 175,000 bpd
- Partners completed Pre-FEED and selected a preferred FPSO contractor
Nigeria moved closer to a final investment decision on its Bonga Southwest/Aparo deepwater project after the Nigerian National Petroleum Company (NNPC) Limited and its partners signed new contractual agreements this week.
NNPC and its contractor parties, Shell Nigeria Exploration and Production Company Limited, Esso Exploration and Production Nigeria (Deepwater) Limited, and Nigerian Agip Exploration Limited, executed the Addendum to the OML 118 Production Sharing Contract and the Addendum to the Dispute Settlement Agreement.
This was disclosed in a statement signed by NNPC’s Chief Corporate Communications Officer, Andy Odey on Monday, and obtained by Businessfront.
The agreements give effect to fiscal and commercial terms the federal government approved to support the project’s development.
The signing follows President Bola Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, part of the government’s broader push to strengthen the competitiveness of Nigeria’s deepwater sector.
Bayo Ojulari, NNPC’s group chief executive officer, said the milestone reflects those reforms taking effect.
“The execution of the BSWAp PSC and DSA Addenda demonstrates the effectiveness of President Tinubu’s reforms in translating policy into 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.
A project sized to reshape Nigeria’s deepwater output
Bonga Southwest/Aparo is expected to attract between $15 billion and $21 billion in investment over its lifetime, with peak production projected at about 175,000 barrels of oil per day and 140 million standard cubic feet of gas per day, according to NNPC.
Once operational, the project is expected to become one of Nigeria’s most significant new deepwater production hubs, contributing materially to the country’s overall oil output, government revenues and foreign exchange earnings.
Ojulari said NNPC will continue working with the federal government, its partners and other stakeholders to ensure the project delivers value for Nigeria.
“NNPC Ltd will continue to work closely with the federal government, our partners and other stakeholders to ensure that this project delivers maximum value for the federation and the Nigerian people,” he said.
What still needs to happen before FID
The OML 118 partners also announced the completion of the project’s Pre-Front End Engineering Design phase, which they said matured the technical and commercial scope of the development and positioned it to advance into the full Front End Engineering Design, or FEED, phase.
This transition remains subject to applicable partner, assurance and governance requirements.
The partners have separately identified a preferred contractor for the project’s Floating Production Storage and Offloading vessel following a competitive selection process.
This provides a basis for progressing the FPSO concept into FEED and undertaking further engineering and commercial work needed to mature the project toward FID.
Any eventual award of the FPSO engineering, procurement, construction and installation contract remains subject to all applicable approvals and requirements.
The project is also expected to expand contracting opportunities for Nigerian companies and strengthen local fabrication, marine and engineering capabilities.
It is expected to support employment and skills development across engineering, offshore construction, logistics and operations as it advances toward a final investment decision.
