Reported by: Ijeoma G | Edited by: Oravbiere Osayomore Promise.
President Bola Ahmed Tinubu has approved a landmark deep offshore investment framework designed to unlock up to $50 billion in fresh capital for Nigeria's oil and gas sector, replacing decades of project-by-project negotiations with a transparent, rules-based system that the administration hopes will restore investor confidence and revive large-scale developments that have remained stalled for years. The reform, given legal effect through the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, establishes clear eligibility criteria, defined implementation processes, and a durable fiscal architecture intended to provide investors with the certainty they have long demanded while safeguarding Nigeria's long-term national value.
The approval, announced on Tuesday, August 11, 2026, by the President's Special Adviser on Information and Strategy, Bayo Onanuga, builds on President Tinubu's engagement with Shell plc Chief Executive Officer Wael Sawan in January 2026, during which the President directed officials to develop the next wave of measures required to unlock Nigeria's deep offshore investment pipeline. Rather than pursuing project-specific solutions, the Federal Government transformed that directive into a comprehensive investment framework applicable across multiple categories of qualifying developments. "Rather than pursuing project-specific solutions, the Federal Government transformed that directive into a comprehensive investment framework applicable across multiple categories of qualifying developments," Onanuga stated.
The reform will kick off with the approximately $10 billion Bonga South West project, a deepwater development by Shell and its partners that has remained on the drawing board for years due to regulatory uncertainty and fiscal disagreements. The Presidency said the framework is designed to strengthen Nigeria's competitiveness for globally mobile investment capital and provide a more predictable environment for long-term offshore investments. "The countries that attract long-term investment are not necessarily those with the greatest natural resources. They are the ones that provide the greatest certainty," President Tinubu said in a statement. "This reform reflects our determination to build an investment environment defined by clear rules, strong institutions and enduring partnerships. We are creating the conditions for capital to flow, for Nigerian businesses to grow, for our people to prosper and for our natural resources to deliver lasting national value."
A defining feature of the reform is its emphasis on Nigerian industrial capability, according to Olu Arowolo-Verheijen, the President's Special Adviser on Oil and Gas. "Projects qualifying under the framework will maximise execution within Nigeria wherever commercially and technically feasible, strengthening domestic engineering, fabrication, marine logistics, technical services and project management," she said. "The objective is not only to increase investment and production, but also to create skilled jobs, deepen local supply chains and position Nigeria as Africa's regional hub for deep offshore project execution."
The approval also enables NNPC Limited, as the Government's nominated counterparty under the Production Sharing Contracts, to proceed with the necessary amendments to eligible Production Sharing Contracts required to implement the framework. This provision is critical because it removes a major administrative bottleneck that has historically delayed project approvals and discouraged investors from committing capital to Nigeria's deepwater sector.
The framework emerged after months of extensive consultations involving the Presidency, the Federal Ministry of Finance, the Federal Ministry of Justice, the Federal Ministry of Petroleum Resources, the Nigeria Revenue Service, NNPC Limited, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Nigerian Content Development and Monitoring Board (NCDMB), legal experts, fiscal authorities, regulators, and industry operators. President Tinubu commended all the agencies and stakeholders involved, saying their collaboration, technical expertise and commitment had helped shape the framework.
Nigeria's deep offshore sector has struggled to attract new investment in recent years as many existing offshore fields mature, contributing to declining production and weaker foreign exchange earnings. The new framework is the most ambitious policy intervention in Nigeria's upstream petroleum sector since the implementation of the Petroleum Industry Act (PIA), replacing the long-standing system of negotiating fiscal incentives on a project-by-project basis with a transparent, rules-based framework applicable to all qualifying deep offshore developments. Government officials believe the framework will immediately support the commencement of the Bonga South West project while opening the door for several other large-scale offshore developments whose combined investment value could reach $50 billion over the coming years.
The reform builds on earlier efforts by the Tinubu administration to revive investment in Nigeria's deep offshore oil sector. In January 2026, the President approved the gazetting of targeted, investment-linked incentives for Shell's proposed Bonga South-West deep offshore project, a move intended to accelerate fresh capital inflows into the energy sector and support the project's Final Investment Decision (FID). At the time, the administration described the project as strategic to boosting crude oil production, employment, and foreign exchange earnings.
The approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, represents a significant shift in Nigeria's approach to attracting foreign investment. By replacing ad hoc negotiations with a predictable, rules-based system, the government is signalling its commitment to transparency and long-term partnership with international oil companies. For investors who have watched Nigeria's deepwater potential remain largely untapped for years, the framework offers a clear path forward. But the true test will be whether the framework delivers on its promise of $50 billion in new investment, or whether it joins the long list of well-intentioned reforms that failed to translate into tangible economic benefits. As President Tinubu himself noted, the countries that attract long-term investment are not necessarily those with the greatest natural resources, but those that provide the greatest certainty. Nigeria has now made its case. The world is watching to see if it can deliver.
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