By Ayomide Otitoju
The Nigerian National Petroleum Company Limited (NNPC Ltd) and the OML 118 contractor parties have signed addenda to the Production Sharing Contract (PSC) and Dispute Settlement Agreement (DSA), marking a major step towards the Final Investment Decision (FID) on the Bonga Southwest, Aparo (BSWAp) deepwater project.
The agreements were executed by NNPC Ltd and the OML 118 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 execution gives effect to fiscal and commercial terms approved by the Federal Government to support the development of BSWAp and is expected to strengthen Nigeria’s position as an attractive destination for large-scale deepwater investment.
The development 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 Federal Government’s efforts to improve the competitiveness of Nigeria’s deepwater sector and attract new investments.
BSWAp is projected to become one of Nigeria’s largest deepwater developments, with potential investment estimated at between $15 billion and $21 billion over the life of the project.
The project is expected to reach peak production of approximately 175,000 barrels of oil per day (bpd) and 140 million standard cubic feet of gas per day (mmscfd).
Speaking on the milestone, NNPC Ltd Group Chief Executive Officer, Engr. Bashir Bayo Ojulari, said the agreement demonstrates the impact of the Federal Government’s reforms in converting policy initiatives into concrete investments.
Ojulari said NNPC Ltd would continue working with the Federal Government, partners and other stakeholders to ensure that the project delivers maximum value to Nigeria.
The contractor parties also announced the successful completion of the project’s Pre-Front End Engineering Design (Pre-FEED) phase, which marks progress in defining the technical and commercial scope of the development.
The project is expected to proceed to the Front End Engineering Design (FEED) phase, subject to the required partner, assurance and governance approvals.
The partners also disclosed that a preferred contractor had been identified for the project’s Floating Production Storage and Offloading (FPSO) facility following a competitive selection process.
However, the selection remains subject to applicable partner, regulatory, assurance and governance processes. Any eventual award of the FPSO Engineering, Procurement, Construction and Installation (EPCI) contract will also require completion of all relevant approvals.
Once operational, BSWAp is expected to contribute significantly to Nigeria’s oil and gas production, government revenues and foreign exchange earnings.
The project is also projected to create employment and expand opportunities for Nigerian businesses across engineering, fabrication, offshore construction, logistics and operations.
In addition, the development is expected to support Nigerian content through increased participation by indigenous contractors and suppliers, while strengthening local fabrication, marine and engineering capabilities.
The project could also facilitate technology transfer and skills development, creating wider economic opportunities across the country.
NNPC Ltd said the milestone reflects collaboration among the Federal Government, regulatory agencies, NNPC Ltd and the OML 118 contractor parties as efforts continue to advance the project towards FID.
The company reaffirmed its commitment to developing BSWAp safely, competitively and responsibly while maximising value for the Nigerian economy and the Federation.
