…As FG secures $8bn investments in 18 months
Nigeria’s ambition to transform its vast gas reserves into a driver of economic growth received a major boost on Tuesday as Shell announced a $2 billion investment in the HI offshore gas field (Oil Mining Lease 144).
The project, which will deliver 350 million standard cubic feet of gas per day (mmscf/d), signals growing confidence in the country’s energy reforms under President Bola Tinubu’s administration and could play a crucial role in strengthening both export and domestic gas supply, experts say.
The HI gas development represents a step towards bridging Nigeria’s gas supply gap. With an output equivalent to nearly one-thirds of the gas required for the Nigeria Liquefied Natural Gas (NLNG) Train 7 project, experts say there will be more reliable feedstock for one of the nation’s most strategic export assets.
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NLNG Train 7, currently under construction, is expected to expand Nigeria’s LNG production capacity from 22 million tonnes per annum to about 30 million tonnes once operational.
By supporting NLNG’s feedstock needs, the HI project is expected to maintain Nigeria’s relevance in global LNG markets at a time when demand for cleaner fuels is rising and competition for supply is intensifying.
More consistent LNG exports will translate into increased foreign exchange earnings, critical for stabilising the naira and supporting government revenue.
Boost for domestic energy access
Beyond exports, the project has implications for Nigeria’s domestic energy landscape. A share of the gas from OML 144 is expected to feed into the domestic network, expanding the supply of liquefied petroleum gas (LPG) and compressed natural gas (CNG).
This could reduce the country’s reliance on imported LPG, support local distribution, and accelerate the adoption of cleaner cooking fuels among households, one of the government’s key clean energy priorities.
Increased domestic gas availability also strengthens Nigeria’s push towards industrialisation. Sectors such as manufacturing, power generation, and fertiliser production, often hampered by unreliable energy supply, stand to benefit from new gas inflows.
Renewed investor confidence
The HI offshore project marks the third major Final Investment Decision (FID) secured in less than two years under President Tinubu, following Shell’s Ubeta gas project and TotalEnergies’ Bonga North deepwater development.
Together, these deals represent more than $8 billion in upstream commitments since mid-2023, a turnaround in investor sentiment after years of uncertainty triggered by policy inconsistencies and delayed reforms.
The government’s recent fiscal and regulatory adjustments under the Petroleum Industry Act (PIA), along with efforts to streamline project approvals and improve contract terms, appear to be paying off.
According to Olu Verheijen, president’s energy adviser, these initiatives are “restoring investor confidence and repositioning Nigeria as a competitive global investment destination.”
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Laying the groundwork for more deals
The successful closure of the HI project could pave the way for more FIDs in the coming months.
The country’s gas reserves stand at a record high of 210.5 trillion cubic feet, according to Gbenga Komolafe, chief executive officer, Nigerian Upstream Petroleum Regulatory Commission (NUPRC), putting the nation among the largest in the world, but it has struggled for decades to convert this potential into tangible economic value.
With the right fiscal incentives and infrastructure investments, analysts believe Nigeria could become a leading gas hub in Africa, supplying both local industries and export markets.
The government’s declared ambition to achieve ‘Decade of Gas’ targets, focusing on gas-to-power, gas-based industries, and clean energy transition, relies heavily on projects like this.
$8bn investment
Bayo Onanuga, special adviser to the President on Information and Strategy, revealed that this deal brings total significant upstream investment commitments through FIDs in Nigeria’s oil and gas sector to over $8 billion since President Tinubu assumed office in 2023, underscoring the success of his reform agenda and the renewed confidence of global investors.
According to him “This investment decision is Nigeria’s third major oil and gas FID in the last 18 months, following the Ubeta Non-Associated Gas project and the Bonga North deepwater project. It marks yet another milestone in Nigeria’s journey to unlock its abundant gas resources for domestic and export use. The Ubeta and HI gas projects can supply up to 15 percent of the NLNG’s total feedgas requirements, covering Trains 1 to 7.”
Recall that in 2024, Tinubu had issued targeted directives as part of the industry reform coordinated by the Office of the Special Adviser to the President on Energy.
These directives have introduced clarity, operating process simplification, cutting contracting costs, and reducing approval cycle times.
These reforms, now embedded in legislation, have restored investor confidence and repositioned Nigeria as a competitive investment destination.
Olu Verheijen, special adviser to President Tinubu on Energy, said: “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.”
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She noted that these projects would 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.
Peter Costello, Shell’s upstream president, said: “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. 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.”
