A restructuring of OML 118, which hosts the Bonga field – Nigeria’s first deepwater oil development – has taken place with subsidiaries of majors Eni (NYSE:E, BIT:ENI) and Shell (LSE/NYSE:SHEL) increasing their stakes and Total Energies (EPA/NYSE:TTE) divesting from it, company statements and advisory disclosures show.

OML 118 began production in 2005 and has produced more than 1bn barrels of crude. The field remains one of Nigeria’s most significant offshore assets and a major source of foreign-exchange earnings.

Eni has increased its stake in OML 118 after its subsidiary, Nigeria Agip Exploration (NAE), acquired an additional 2.5% interest from TotalEnergies EP Nigeria. The Italian major exercised its pre-emption rights under the Production Sharing Contract (PSC), lifting NAE’s holding from 12.5% to 15% after receiving all required regulatory approvals.

The stake transfer aligns with Eni’s strategy to optimise its upstream portfolio and reinforce its long-standing presence in Nigeria, where the company has operated since 1962 and expects to maintain an equity output of around 50,000 boed in 2025.

At the same time, Shell Nigeria Exploration and Production Company (SNEPCo), a subsidiary of Shell plc, confirmed completion of its own transaction, raising its interest in OML 118 from 55% to 65%. Shell had previously agreed terms with TotalEnergies to purchase a majority portion of its interest.

TotalEnergies announced it had divested its entire 12.5% non-operated interest to Shell (10%) and NAE (2.5%) for a total consideration of $510mn, according to advisory firm Templars, which acted on the deal.

The French major, which has operated in Nigeria for over six decades, said the divestment reflects a streamlining of its non-operated portfolio as it pivots toward gas-focused developments, including new feedgas commitments to NLNG and ongoing work in OML 58. TotalEnergies produced around 209,000 boed in Nigeria in 2024 and maintains one of the country’s largest retail networks, with more than 540 service stations.

The updated PSC partner structure after the transaction is: Shell (SNEPCo) – 65% (operator); NAE (Eni) – 15%; TotalEnergies – reduced minority stake (pending final NUPRC registry confirmation); and Nigerian National Petroleum Company Limited (NNPCL) – PSC counterparty under the Petroleum Industry Act.

The restructuring of OML 118 comes amid a broader push by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to conclude long-pending asset transactions following the implementation of the Petroleum Industry Act (PIA). The regulator has said deepwater blocks such as OML 118 are central to stabilising Nigeria’s long-term offshore production outlook.

Deepwater assets account for more than 30% of Nigeria’s offshore production, according to OPEC and NUPRC data, and remain a vital revenue source for the government. The finalisation of ownership changes in the Bonga PSC is expected to support ongoing investment in redevelopment and infill drilling programmes.