Nigeria granted Shell Plc a production-linked tax credit for a deepwater project, an incentive that will be offered to other oil majors as Africa’s biggest producer seeks to boost production, according to people familiar with the matter.
Terms approved by President Bola Tinubu to push the Bonga Southwest Aparo project toward a final investment decision give Shell and its partners a rebate of $11.50 per barrel of crude produced, said the people who asked not to be identified because the information is not public. That’s more than double the standard amount.
The incentive will be offered to other producers for new deepwater projects and will remain in place until at least 2029, the people said. Bonga Southwest is expected to attract $20 billion in foreign direct investment and produce 150,000 barrels a day upon completion, the state oil company said in March.
A spokesperson for Shell said the company continues to progress the project toward development and will communicate material updates through official channels. The Nigerian National Petroleum Co. and the president’s energy adviser didn’t respond to requests for comment.
The measure adds to a raft of incentives Nigeria initiated through executive orders since Tinubu took power in 2023, setting out to revive a sector hobbled by rampant theft, vandalism, aging infrastructure and waning investment. A previous order capped such tax credits at 20% of a licensee’s annual tax liability to offset operating costs, which the government said was high compared with the global average. Related News Analysts downplay impact of PFIPC scandal on Nigeria’s FDI recovery ntel abandons telco playbook to chase AI, infrastructure growth Trump drops 20% Hormuz fee plan in favour of Gulf investment deals
