The federal government’s latest deepwater fiscal reforms have cleared a major commercial hurdle for the proposed Bonga Southwest/Aparo (BSWAp) project, with NNPC Limited and its international partners targeting between $15 billion and $21 billion in investment over the life of the development.
The investment commitment emerged as the Nigerian National Petroleum Company Limited (NNPC Ltd) and the OML 118 contractor parties executed addenda to the OML 118 Production Sharing Contract (PSC) and Dispute Settlement Agreement (DSA), giving effect to fiscal and commercial terms approved by the government for the deepwater project.
The milestone moves BSWAp closer to a Final Investment Decision (FID) at a time when Nigeria is seeking to reverse declining oil production, attract fresh capital into upstream projects and strengthen government revenues and foreign exchange earnings from the petroleum sector.
The project, being developed by NNPC Ltd, Shell Nigeria Exploration and Production Company Limited (SNEPCo), Esso Exploration and Production Nigeria (Deepwater) Limited and Nigerian Agip Exploration Limited (NAE), is expected to become one of the country’s largest new deepwater production developments.
Bashir Bayo Ojulari, group chief executive officer of NNPC Ltd, said the project could reach peak production of about 175,000 barrels of oil per day, alongside 140 million standard cubic feet of gas per day.
“BSWAp is expected to be one of Nigeria’s largest deepwater developments, with the potential to attract $15 billion to $21 billion in investment over the life of the project,” Ojulari said.
The project is expected to generate economic benefits through increased crude oil and gas production, government revenues, foreign exchange earnings, local content development and employment, while creating opportunities for Nigerian businesses across the energy value chain.
The execution of the PSC and DSA addenda follows President Bola Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, which the government has positioned as part of its broader effort to improve the competitiveness of Nigeria’s deepwater sector.
NNPC said the agreements reinforce Nigeria’s objective of creating a “competitive, stable and attractive” environment for deepwater 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,” Ojulari said.
Beyond the commercial agreement, the contractor parties have completed the project’s Pre-Front End Engineering Design (Pre-FEED) phase, bringing the technical scope closer to the level required for the next stage of development.
The project is now positioned to progress into the Front End Engineering Design (FEED) phase, subject to partner, assurance and governance requirements.
The contractor parties have also identified a preferred contractor for the project’s Floating Production Storage and Offloading (FPSO) facility following a competitive selection process.
The preferred selection provides a basis for developing the FPSO concept through FEED and undertaking additional engineering and commercial work needed to advance the project towards FID.
However, the selection does not yet constitute an award of the FPSO Engineering, Procurement, Construction and Installation (EPCI) contract.
Any eventual EPCI award remains subject to the completion of relevant partner, regulatory, assurance and governance approvals.
The scale of the proposed development is expected to make BSWAp strategically important to Nigeria’s efforts to increase crude production and strengthen the country’s external earnings.
At its projected peak of 175,000 barrels per day, the project’s output would represent a material addition to national production, while the associated gas production could also support domestic energy supply and industrial activity.
The investment could also provide opportunities for Nigerian contractors and service companies as engineering, fabrication, logistics, marine services and other activities expand during the construction and operational phases.
Ojulari said NNPC would continue working with the federal government, project partners and other stakeholders to ensure that the development delivers value to the Federation and Nigerians.
Once operational, BSWAp is expected to become one of Nigeria’s significant new deepwater production hubs, supporting the government’s ambition to grow oil and gas output on a sustainable basis.
