The Nigerian National Petroleum Company Limited (NNPC Ltd) and the OML 118 Contractor Parties have signed the Addendum to the OML 118 Production Sharing Contract (PSC) and the Addendum to the Dispute Settlement Agreement (DSA), marking a major milestone in the development of the Bonga South-West Aparo (BSWAp) deepwater project.
The Contractor Parties comprise 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 the fiscal and commercial terms approved by the Federal Government for the development of BSWAp and move the project closer to Final Investment Decision (FID).The milestone follows President Bola Ahmed Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, a key component of the Federal Government’s reforms aimed at improving the competitiveness of Nigeria’s deepwater sector and attracting new investment.The execution of the PSC and DSA Addenda demonstrates the practical impact of the reforms in translating policy decisions into investment and project development.
BSWAp is expected to become one of Nigeria’s largest deepwater developments, with the potential to attract between US$15 billion and US$21 billion in investment over the life of the project.The project is also expected to achieve peak production of approximately 175,000 barrels of oil per day (kbopd) and 140 million standard cubic feet of gas per day (mmscfd).
Beyond increased oil and gas production, the development is expected to generate significant benefits for the Nigerian economy through higher government revenues, increased foreign exchange earnings, local content development, employment creation and expanded opportunities for Nigerian businesses.Speaking on the milestone, the Group Chief Executive Officer of NNPC Ltd, Engr. Bashir Bayo Ojulari, said the execution of the agreements demonstrated the effectiveness of the Federal Government’s reforms in converting policy into investment.
“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. 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.”
The Contractor Parties also announced the successful completion of the project’s Pre-Front End Engineering Design (Pre-FEED) phase, marking a significant step in maturing the technical and commercial scope of the development.
The project is now positioned to progress into the Front End Engineering Design (FEED) phase, subject to applicable partner, assurance and governance requirements.Following a competitive selection process, a bidder has also been identified as the preferred Floating Production Storage and Offloading (FPSO) contractor for the project, subject to the completion of relevant partner, regulatory, assurance and governance processes.
The selection provides a basis for advancing the FPSO concept into FEED and undertaking further engineering and commercial work required to mature the project towards FID.However, any eventual award of the FPSO Engineering, Procurement, Construction and Installation (EPCI) contract remains subject to the completion of all applicable approvals and requirements.
Once operational, BSWAp is expected to become one of Nigeria’s most significant new deepwater production hubs, contributing materially to national oil output and supporting the country’s ambition to sustainably increase oil and gas production.The project is also expected to create significant direct and indirect employment opportunities across engineering, fabrication, offshore construction, logistics and operations, while generating billions of dollars in investment.In addition, BSWAp is expected to deepen Nigerian content development by increasing contracting opportunities for indigenous companies, strengthening local fabrication, marine and engineering capabilities, promoting technology transfer and supporting skills development.
The latest milestone reflects continued collaboration among NNPC Ltd, the Federal Government, relevant regulatory agencies and the OML 118 Contractor Parties.NNPC Ltd reaffirmed its commitment to working with all stakeholders to advance the BSWAp project safely, competitively and responsibly, while maximising value for Nigeria and the Nigerian people.
