On Monday, NNPC Ltd and the OML 118 contractor parties – Shell Nigeria Exploration and Production Company (SNEPCo), as operator, Esso Exploration and Production Nigeria (Deepwater) and Nigerian Agip Exploration – executed addenda to the OML 118 Production Sharing Contract and Dispute Settlement Agreement, clearing a fiscal and legal hurdle for the deepwater Bonga South-West/Aparo (BSWAp) project as it advances toward a Final Investment Decision.
BSWAp is positioned to become Nigeria’s largest deepwater development, with potential lifetime investment of USD 15 billion – 21 billion and peak production of about 175,000 bopd and 3.96 mcm (140 mscf) of gas. Alongside the signing, the partners confirmed completion of the project’s Pre-FEED phase, its progression into FEED, and the selection of a preferred bidder for the FPSO EPCI contract – not yet named – subject to regulatory and governance approvals.
NNPC linked the milestone directly to President Bola Tinubu’s Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, framing it as evidence that fiscal reform is translating into bankable projects. NNPC Group CEO Bashir Bayo Ojulari said the addenda demonstrate “a competitive fiscal framework and a clear pathway for sustainable investment,” adding that NNPC would work with partners “to ensure that this project delivers maximum value for the Federation and the Nigerian people.”
The signing caps a stop-start history stretching back over a decade. Shell first opened FPSO bidding for the project in 2014, then targeting what would have been the world’s largest FPSO at an estimated cost of USD 12 billion. Tender response proved underwhelming, and the project stalled for years amid a long-running tax dispute with the federal government, resolved only through a May 2021 settlement that set OML 118’s ownership at SNEPCo as operator, Esso with 20% and NAE with 12.5%, alongside TotalEnergies. Shell moved to absorb part of TotalEnergies’ stake in 2025, a transfer Nigerian authorities approved that September.
FID itself has not yet been taken, and the FPSO award remains conditional on further approvals – today’s signing is a significant step toward unlocking the project, not its conclusion.
source: The Energy Year