Nigeria’s oil and gas sector is showing early signs of recovery, driven by regulatory reforms, rising indigenous participation, and renewed investor interest, despite persistent production and security challenges. The developments were highlighted by Pedro Omontuemhen, Partner and Clients & Market Leader at PwC Nigeria, during the Lagos Chamber of Commerce and Industry (LCCI) 2026 Economic Review and Outlook Conference.
Omontuemhen revealed that Nigeria’s crude oil production averaged 1.64 million barrels per day in 2025—an improvement over previous years but still below the country’s potential of over two million barrels per day. He attributed the shortfall to factors including oil theft, ageing infrastructure, operational inefficiencies, and years of underinvestment across key assets.
The expert highlighted that reforms under the Petroleum Industry Act (PIA) and recent executive orders have attracted over $16 billion in new investments into the sector. These measures have strengthened regulatory oversight, clarified fiscal policies, and encouraged greater participation from local operators. However, challenges remain, particularly for onshore producers facing funding gaps, crude theft, and pipeline vandalism.
Omontuemhen also noted a structural shift in Nigeria’s oil landscape, with indigenous companies now controlling roughly 55% of production following divestments by international oil companies. He emphasized the role of deepwater projects, modular refineries, and the Dangote Refinery in improving domestic refining capacity, though he cautioned that reliance on imported crude feedstock continues to be a limiting factor.
Looking ahead, the PwC official said Nigeria’s oil sector is poised for cautious optimism in 2026, with projected output recovering to between 1.8 and 2.0 million barrels per day. He stressed that sustained reforms, security improvements, and consistent policy implementation will be critical to unlocking long-term growth and ensuring the country capitalizes on its significant oil and gas reserves.
source: The Guardian