Nigeria’s oil and gas industry is undergoing a major transformation, with indigenous companies now responsible for more than 50% of the country’s crude oil production. This marks a significant rise from the previous 40% share held by local firms before international oil majors began divesting their onshore and shallow-water assets. The shift highlights the growing role of Nigerian-owned operators in the nation’s energy sector.
The increase in local production comes as global giants such as Shell, ExxonMobil, ENI, and TotalEnergies pull back to focus on deepwater projects, selling off substantial onshore assets. Nigerian firms have stepped into the gap with aggressive investment plans and operational expansions, including the recent launch of Nigeria’s first fully indigenous onshore crude export terminal at Otakikpo, which can handle 360,000 barrels per day.
Other notable developments include Conoil’s maiden export of its new Obodo crude blend and Renaissance Africa Energy’s $15 billion investment pledge to boost production and gas output after acquiring Shell’s assets. Seplat Energy is also investing heavily in reopening over 400 shut-in wells and upgrading infrastructure to increase its production capacity to 140,000 barrels per day.
While the rise of local producers aligns well with the Federal Government’s goals under the Petroleum Industry Act to expand upstream investment, challenges remain. Analysts warn that security issues, community conflicts, oil theft, and ageing infrastructure continue to inflate operational costs and could limit growth unless effectively managed.
Despite these hurdles, experts agree that the expanding footprint of indigenous oil companies is a critical factor in reversing Nigeria’s declining crude output. This momentum could strengthen the country’s energy security and improve its position in global oil markets over the coming years.
Source: Punch