By Joy Onu
The Chief Executive Officer of Shell Plc, Mr Wael Sawan, has indicated the company’s interest in committing up to $20 billion to Nigeria’s energy sector, citing recent policy direction and improvements in the investment climate under President Bola Ahmed Tinubu’s administration.
Sawan made the disclosure during a meeting with the President at the Presidential Villa, Abuja, where he said Shell and its partners are reassessing and expanding their long-term investment plans in Nigeria following years of reduced engagement.
The renewed interest comes as Nigeria intensifies efforts to attract foreign direct investment into its oil and gas sector amid declining crude output, rising operating costs, and growing competition for capital from other energy-producing countries.
Shell’s recent projects include a $5 billion investment in Bonga North, $2 billion in the HI project, and continued gas supply commitments to the Nigeria Liquefied Natural Gas (NLNG) plant. According to the company, these investments reflect cautious optimism about Nigeria’s long-term prospects rather than an immediate large-scale capital inflow.
Sawan noted that multinational energy firms increasingly prioritise regulatory stability and policy consistency when committing funds for projects with timelines spanning several decades. He suggested that Nigeria’s current framework is becoming more competitive relative to other jurisdictions.
Shell has also increased its stake in Oil Mining Lease (OML) 118, known as the Bonga Block, following its acquisition of interests previously held by TotalEnergies. Industry observers see the move as part of Shell’s strategic shift toward deep offshore assets, where operational risks are generally lower than onshore operations.
Central to the discussions is the proposed Bonga South West project, which could attract up to $20 billion in foreign direct investment if it advances to Final Investment Decision (FID). However, analysts note that such commitments typically depend on fiscal certainty, project economics, and long-term political stability.
In response, President Tinubu approved the gazetting of investment-linked incentives for the Bonga South West deep offshore project and directed his Special Adviser on Energy, Mrs Olu Arowolo-Verheijen, to implement the process within Nigeria’s existing legal and fiscal frameworks.
The President stated that the incentives are structured around new investments, incremental production, and stronger local content participation, rather than broad concessions.
“These incentives are ring-fenced and investment-linked, focused on new capital and national economic value,” he said.
While the proposed investment signals renewed confidence in Nigeria’s offshore oil sector, its broader economic impact will likely depend on how quickly the project progresses to Final Investment Decision and how transparently the incentive framework is implemented.
