In a powerful endorsement of Nigeria’s ongoing energy sector reforms, Shell Plc has announced a Final Investment Decision (FID) on a new $2 billion offshore gas project, marking the third such major commitment in the last 18 months and bringing total new upstream investments under the Tinubu administration to over $8 billion.
The announcement, detailed in a press release from the Statehouse on Monday, signifies a rapidly accelerating momentum in Nigeria’s oil and gas industry, which has been the beneficiary of a series of presidential directives designed to attract capital and streamline operations.
The new project, targeting the HI Field in the shallow waters of OML 144, is a Non-Associated Gas (NAG) development set to deliver approximately 350 million standard cubic feet of gas per day (mmscf/d) by 2028.
This output is equivalent to almost one-third of the feedgas required for the crucial Nigeria LNG Limited’s Train 7 project, positioning it as a critical enabler for the country’s liquefied natural gas (LNG) expansion ambitions.
President Bola Ahmed Tinubu welcomed the decision, framing it as a direct outcome of his government’s strategic policy shifts. “This major FID announcement by Shell, their second in one year, is a clear validation of our wide-ranging reform efforts and a signal to the world that Nigeria is fully open for business and investment,” the President said in the official statement.
The Shell investment is the latest in a succession of landmark FIDs that have signaled a resurgence of global investor confidence in Nigeria’s energy landscape. It follows the Ubeta NAG project, also operated by Shell, and the Bonga North deepwater oil project, a joint venture with the Nigerian National Petroleum Company Limited (NNPC).
Collectively, the HI and Ubeta gas projects are poised to supply up to 15 percent of the total feedgas requirements for NLNG’s Trains 1 through 7, securing a long-term domestic gas supply for the export facility.
Central to this investment surge are the reforms orchestrated by the Office of the Special Adviser to the President on Energy. Since 2024, President Tinubu has issued targeted directives introducing unprecedented fiscal incentives, regulatory clarity, and process simplifications aimed at slashing high contracting costs and protracted approval cycles that have historically plagued the sector.
These reforms, now embedded in legislation, have created a more competitive and predictable investment climate. The development of the HI field, discovered four decades ago in 1985, was specifically unlocked by Presidential Directive 40, which established a competitive fiscal framework for Non-Associated Gas in onshore and shallow offshore fields.
In a statement, Olu Arowolo Verheijen, Special Adviser to President Tinubu on Energy, emphasized the transformative impact of the consecutive investments. “With the Ubeta FID and now the HI FID, we have secured the gas supply needed to make NLNG Train 7 not just possible, but transformative,” Verheijen stated.
She further outlined the broader economic benefits, noting, “These projects will significantly strengthen the reliability of Nigeria’s LNG exports to global markets while expanding LPG supply for domestic use — reducing imports, boosting foreign exchange earnings, and advancing clean cooking access for millions of Nigerian households. And this is only the beginning; more FIDs are on the horizon, proving that with the right policies in place, investment and impact follow.”
Echoing the sentiment of renewed partnership, Peter Costello, Shell’s Upstream President, commented on the company’s continued commitment. “Following recent investment decisions related to the Bonga deep-water development, today’s announcement demonstrates our continued commitment to Nigeria’s energy sector, with a focus on Deepwater and Integrated Gas,” Costello said. “This Upstream project will help Shell grow our leading Integrated Gas portfolio, while supporting Nigeria’s plans to become a more significant player in the global LNG market.”
The NLNG Train 7 project, which this new gas supply will support, is set to expand Nigeria’s LNG production capacity by 8 million metric tonnes per annum, a 35 percent increase from current levels.
Beyond reinforcing Nigeria’s position in the global energy value chain, the project is expected to catalyze significant domestic economic activity, including job creation, stimulation of small and medium-sized enterprises (SMEs) in host communities, and enhanced energy security.
The consecutive final investment decisions represent a tangible reversal of fortune for Nigeria’s energy sector, suggesting that the government’s strategy to position the country as a competitive and fiscally attractive destination for capital is yielding decisive results.
Discussion about this post