Tinubu at Two: Energy Sector Grapples with Persistent Challenges Amid Modest Progress
As President Bola Tinubu’s administration marks its two-year anniversary, Nigeria’s energy sector remains deeply entangled in both domestic and international challenges. Industry analysts argue that despite government rhetoric, progress remains marginal, with issues like insecurity, oil theft, lack of investment, and inadequate infrastructure continuing to obstruct meaningful reform. While topics such as gas monetisation and renewable energy expansion dominate policy discussions, the reality on the ground reflects a sector still burdened by legacy problems and an elusive transformation agenda.
The oil and gas sector’s contribution to GDP has dropped to about 5–6%, from a former 9%, mainly due to stagnant production levels around 1.8 million barrels per day. The administration’s pledge to reinvest fuel subsidy savings into public infrastructure and social services has so far not yielded tangible results. Rising poverty, high unemployment, and decaying infrastructure persist. Similarly, in the power sector, the government remains trapped in a cycle of unsustainable electricity subsidies, now nearing N800 billion, with consumers seeing little improvement in service delivery despite new tariff structures.
Repeated national grid collapses and limited electricity generation—hovering around 5,000 megawatts—highlight the fragile state of Nigeria’s power infrastructure. Discontent has grown among consumers, especially those in Band A who pay higher tariffs with little to no corresponding supply. Institutions such as the University College Hospital and Aso Rock have struggled with electricity bills, prompting emergency measures like solar energy initiatives. The government’s inability to implement the next phase of the National Mass Metering Programme further complicates the sector’s credibility.
Nevertheless, the Tinubu administration has taken steps to stimulate growth in oil and gas through new initiatives. These include awarding 25 oil blocks and 10 gas distribution licenses, establishing mini-LNG projects, and signing a $3.3 billion Brass Methanol deal. Officials have also reaffirmed targets to boost daily oil production to 2.5 million barrels, though many industry stakeholders remain skeptical, citing poor infrastructure, outdated equipment, and long-standing operational inefficiencies.
Experts and industry leaders warn that the administration must urgently address refinery revitalisation, oilfield infrastructure gaps, and regulatory enforcement to reverse the downward trend. Calls have intensified for Tinubu to prioritise domestic refining capacity to reduce import dependency, especially with the looming launch of BUA’s 350,000 bpd refinery. Analysts forecast that without substantial investment and implementation of reforms, Nigeria may face declining oil production by 2026, threatening its economic stability and energy independence in the years ahead.
Source: The Sun