Shell signals fresh $20bn investment push in Nigeria

Shell Plc has signalled a renewed and expanded investment push in Nigeria, citing improved political stability, policy consistency, and leadership as key factors driving its confidence in the country’s energy sector.

Join the Premium Times WhatsApp Community For Quick Access To News and Happenings Around You.

Open in WhatsApp

The Chief Executive Officer of Shell Plc, Wael Sawan, disclosed the company’s investment plans during a meeting with President Bola Tinubu in Abuja on Thursday.

The official explained that Nigeria now stands out as one of the most attractive destinations for capital allocation within Shell’s global portfolio.

“We think there is more to invest here, and we understand the vision that you (President Bola Tinubu) have for the country, and so we are indeed working on a project, Bonga Southwest, that could potentially, if we get to an FID stage, see us, with the partners, invest around $20 billion in foreign direct investment,” Mr Sawan said.

Stay Ahead with Premium Times

Add as a preferred source on Google

He explained further that half of the $20 billion will be capital, and the other half will be the operating expenses and the likes that will come into the country.

Mr Sawan praised Nigeria’s human capital, describing Nigerian professionals within Shell’s global operations as one of the company’s largest expatriate talent pools, many of whom, he said, are expected to return home to contribute to national development.

Over the past three decades, Shell has been a dominant operator in Nigeria’s oil and gas industry, largely through its subsidiary, Shell Petroleum Development Company of Nigeria Limited (SPDC).

While its operations, concentrated in the Niger Delta, have generated significant revenue for the Nigerian government, they have also been linked to environmental degradation and social unrest, drawing sustained criticism, lawsuits, and international scrutiny.

Shell has also faced numerous lawsuits in the UK and Dutch courts, resulting in landmark rulings holding it liable for environmental damage. In 2021, a Dutch court ordered Shell to pay compensation to Nigerian farmers, marking a significant, albeit late, accountability moment.

A PREMIUM TIMES investigation last year found that several oil-producing communities, including Ogoniland, continue to suffer hydrocarbon pollution. The report showed that many residents, whose livelihoods depend on farming and fishing, have lost access to farmlands and waterways due to recurring oil spills from creeks and pipelines, often attributed to the negligence of oil companies.

Why we are investing in Nigeria

During the meeting with Mr Tinubu on Thursday, Mr Sawan told the president that “We are very keen to invest in Nigeria. But I would say this has not always been the case”.

He explained that Mr Tinubu’s leadership and vision have created an investment climate over the last few years that has propelled them to invest, especially when they compare Nigeria with other investment destinations around the world.

According to the Shell official, stability has become a premium factor for long-term energy investments, noting that the company typically plans projects spanning 20 to 40 years.

The executive said Nigeria now ranks among the countries attracting more capital than most peers, largely due to recent reforms and governance improvements.

Investments so far

In the last 12 months alone, Mr Sawan revealed that Shell has invested about $5 billion in the Bonga North project and an additional $2 billion in gas infrastructure supporting the Nigeria Liquefied Natural Gas (NLNG) project.

He said the company also deepened its interest in Oil Mining Lease (OML) 118 after acquiring assets previously held by TotalEnergies.

READ ALSO: Nigerian gov’t gazettes incentives to fast-track Shell’s Bonga South West oil project

Beyond existing projects, he disclosed plans for a proposed Bonga Southwest development, which could attract up to $20 billion in foreign direct investment if it reaches a final investment decision (FID).

The proposed investment, he said, would include both capital expenditure and operational spending and is expected to rank among the largest energy projects globally.

The company said it has commenced pre-Front-End Engineering Design (pre-FEED) work on the project, with the aim of fast-tracking it towards FID by 2027, subject to regulatory approvals and finalisation of fiscal incentives.

Shell also indicated interest in other prospective projects, including Bolia Chota and Mwadoro, as well as Nigeria’s ongoing oil exploration licensing round.

In his response, President Tinubu assured Shell of the federal government’s commitment to transparency, competitiveness, and policy consistency, stressing that Nigeria must actively compete with other oil-producing countries such as Guyana for global capital.

“There’s no better time to invest than now,” the president said, pledging that all approved incentives would be delivered and applied consistently.

He added that Nigeria’s greatest resource remains its people, noting that developing local talent is critical to achieving long-term value from the country’s natural resources.

Shortly after the meeting, the president approved the gazetting of targeted, investment-linked incentives to support Shell’s proposed Bonga South West deep-offshore oil project and other similar offshore developments in the country.