Nigeria’s Deepwater Failure Has Cost Us Too Much

It is high time we realised that capital does not reward geological promise alone; it rewards certainty, competitive economics and institutions capable of making decisions on time. Nigeria’s prolonged dependence on project-by-project negotiations turned these basic requirements into obstacles, leaving major deepwater projects stranded while competing jurisdictions attracted capital we should have been fighting harder to retain.

We therefore regard President Bola Ahmed Tinubu’s approval of the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, as an overdue correction. The new rules-based framework could unlock up to $50 billion in deep offshore investment, beginning with the approximately $10 billion Bonga South West project. But we should not congratulate ourselves excessively for finally addressing dysfunction that should never have persisted for decades.

The real reform is not the tax remission alone. It is the decision to replace discretionary, prolonged negotiations with transparent eligibility criteria and predictable implementation processes. We have repeatedly weakened Nigeria’s investment proposition by forcing investors to negotiate uncertainty when Angola, Guyana, Brazil and other jurisdictions were competing for the same globally mobile capital.

President Tinubu captured the issue correctly: “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. This reform reflects our determination to build an investment environment defined by clear rules, strong institutions and enduring partnerships.”

We agree. But certainty must survive beyond presidential directives. Investors committing billions of dollars to projects with decades-long lifecycles need confidence that rules will outlast administrations, bureaucratic changes and political moods. That is where Nigeria’s credibility will ultimately be tested.

Allowing Nigerian National Petroleum Company Limited to proceed with necessary amendments to eligible Production Sharing Contracts should remove another bureaucratic obstruction. Yet approvals matter only when they produce Final Investment Decisions, construction activity, additional barrels and revenue.

We are particularly encouraged by the local-content dimension. Olu Arowolo-Verheijen, Special Adviser to the President on Oil and Gas, said qualifying projects should maximise Nigerian execution wherever commercially and technically feasible.

“This means more work for domestic engineering firms, fabrication yards, marine logistics, technical services and project management companies,” she said. “The objective is not only to increase investment and production, but also to create skilled jobs and deepen local supply chains.”

That distinction is crucial. We should reject an offshore investment model in which billions flow into Nigerian resources while engineering, fabrication, technical expertise and high-value employment remain overwhelmingly offshore. If Nigeria intends to become Africa’s deepwater execution hub, local companies must graduate from peripheral contracting into technically sophisticated segments of the value chain.

We should also resist treating the headline $50 billion as money already secured. It is investment that could be unlocked. The difference matters. Nigeria has announced too many prospective billions that never became productive assets. We should measure this reform by sanctioned projects, committed capital, Nigerian content, production additions, foreign-exchange inflows and government revenues.

Bonga South West will therefore become the first serious credibility test. If a project stalled for years can move efficiently towards Final Investment Decision under the new framework, investors will notice. If bureaucracy merely reappears in another form, they will notice that too.

We have lost enough time. Nigeria’s deepwater resources cannot remain geological wealth trapped beneath administrative failure. The government has finally attacked a central obstacle: uncertainty. We should now insist on relentless implementation.

The opportunity is enormous, but opportunity without execution is merely another Nigerian promise. We need the $50 billion translated from projection into platforms, pipelines, jobs, production and revenue. Only then can we say that Nigeria has truly reclaimed its deepwater investment future.