In a major boost to Nigeria’s energy and export ambitions, Shell Plc and its local partner, Sunlink Energies, have jointly approved the development of a new offshore gas project that will supply feedstock to the country’s liquefied natural gas (LNG) export facilities.
The project, known as the HI Gas Field Development, is located about 50 kilometres offshore in water depths of around 100 metres and is projected to deliver up to 350 million standard cubic feet of gas per day (MMscf/d) at peak production. The gas will be supplied to Nigeria LNG (NLNG) on Bonny Island, one of Africa’s largest LNG export hubs.
Strategic Partnership and Ownership Structure
Under the agreement, Sunlink Energies will hold a 60% operating interest, while Shell retains the remaining 40%. The partners are expected to begin production before the end of this decade, aligning with Shell’s strategy to grow its global LNG portfolio by 4-5% annually through 2030.
The HI field was originally discovered in 1985, but the renewed development reflects a fresh wave of investment confidence in Nigeria’s offshore gas and deepwater resources.
Significance for Nigeria’s Energy Future
This investment underscores Shell’s continued commitment to Nigeria, despite its gradual divestment from onshore assets. It comes at a time when the country is seeking to expand natural gas exports and transition toward cleaner, gas-based energy systems that can generate foreign exchange and reduce domestic power shortages.
The HI Gas Project will also reinforce supply to the NLNG Train 7 expansion, which is set to increase the facility’s total production capacity by over 30%. Industry observers view the development as a critical milestone that will help sustain Nigeria’s position among the world’s leading LNG exporters.
Statements and Industry Reactions
Commenting on the investment decision, Peter Costello, Shell’s Upstream Director, stated:
“Following our recent commitment to expand the Bonga deepwater project, this new offshore development demonstrates Shell’s enduring partnership with Nigeria and our focus on deepwater and integrated gas investments that deliver sustainable energy growth.”
The announcement was welcomed by Nigeria’s energy authorities, who described it as a strategic addition to ongoing efforts to attract foreign investment into the country’s gas infrastructure, especially under the Decade of Gas Initiative launched by the Federal Government.
Economic and Technical Outlook
The HI project is expected to generate hundreds of skilled and semi-skilled jobs during its construction phase, while advancing local content participation through engineering, fabrication, and logistics contracts.
Key challenges will include ensuring timely regulatory approvals, managing deepwater technical risks, and integrating offshore gas output into existing NLNG processing systems.
However, with Shell and Sunlink’s combined technical expertise, the project is widely seen as capable of setting new standards in offshore gas development and export efficiency.
