Bayo Onanuga, the special adviser on information and strategy to President Bola Tinubu, announced on Tuesday that Shell has finalized a $2 billion investment decision for a new gas project in Nigeria. This brings the total significant upstream investment commitments in the country to over $8 billion since President Tinubu took office earlier in 2023.
Onanuga shared this information via a post on X (formerly Twitter), emphasizing that the new investment reflects both the success of Tinubu’s comprehensive reform agenda and a renewed confidence among global investors in Nigeria, Africa’s largest oil producer. The final investment decisions (FIDs) are critical milestones that confirm a company’s commitment to proceed with a project in the oil and gas sector.
Since taking office, President Tinubu has implemented targeted directives aimed at reforming the energy industry, as coordinated by the Office of the Special Adviser to the President on Energy. These reforms include introducing attractive fiscal incentives, enhancing regulatory clarity, simplifying operational processes, and minimizing costs and approval timelines.
The three key FIDs announced—the HI and Ubeta gas projects and Bonga North deepwater project—have been carefully selected by the federal government to drive the execution of the presidential directives. On Tuesday, Shell Nigeria Exploration and Production Company Limited (SNEPCo), a subsidiary of Shell plc, confirmed its FID on the HI gas project located offshore Nigeria, partnering with indigenous firm Sunlink Energies and Resources Limited.
When fully operational, the HI gas project will supply 350 million standard cubic feet of gas per day to Nigeria LNG (NLNG) Limited’s Train 7 project, which accounts for nearly one-third of the gas required for this expansion. Onanuga noted that the HI gas field, first discovered in 1985, is bolstered by a presidential directive aimed at establishing a competitive fiscal framework specifically for non-associated gas in onshore and shallow offshore areas.
Olu Arowolo Verheijen, the special adviser to the president on Energy, stated that the Ubeta FID in conjunction with the HI FID ensures a stable gas supply that makes the NLNG Train 7 project feasible and transformative. She highlighted that these initiatives would greatly enhance the reliability of Nigeria’s LNG exports to global markets and increase domestic liquefied petroleum gas (LPG) supply. Consequently, this development is expected to reduce imports, boost foreign exchange earnings, and improve access to clean cooking solutions for millions of Nigerian households.
Peter Costello, Shell’s upstream president, added that the project aligns with Shell’s strategic growth in the gas market while facilitating Nigeria’s ambitions to strengthen its position in the global LNG arena. The NLNG Train 7 project aims to augment Nigeria’s LNG production capacity by 8 million metric tonnes annually, which represents a substantial 35 percent increase in current output.