Nigeria’s Oil and Gas Sector in 2025: Navigating Maturity in a Transitioning World
UPDATED: 30 July 2025
Oil and gas remain at the heart of Nigeria’s economy, despite the growing global shift towards renewables and cleaner fuels. While the energy landscape is undergoing profound change, Nigeria’s hydrocarbons continue to provide the financial scaffolding for both national budgets and foreign exchange reserves. It’s an industry that has matured over the decades but is now standing at the edge of a new transformation. One shaped by internal policy shifts, international pressure to decarbonise, and regional competition.
As of early 2025, Nigeria holds an estimated 37 billion barrels of proven crude oil reserves, along with over 210 trillion cubic feet of natural gas. These figures, sourced from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), position the country firmly at the top of Africa’s energy hierarchy. But as the world gradually turns the page on fossil fuel dominance, the question isn’t simply how much oil Nigeria has, it’s how the country intends to use it, attract sustainable investment, and remain globally relevant.
From Discovery to Deepwater Ambitions
Oil was discovered in Nigeria in 1956, and the first commercial production began two years later. Since then, Nigeria has become synonymous with African energy production. It joined OPEC in 1971, even before it had formalised its state oil company, now known as NNPC Limited. The oil boom of the 1970s ushered in decades of fluctuating wealth, mismanagement, and reform—yet the sector has continued to deliver, both for investors and for the state.
While production has not always kept pace with potential, current output hovers around 1.45 million barrels per day, with ambitions to hit 2 million bpd by the end of 2025. That goal remains ambitious, not because the resources don’t exist, but because operational disruptions – particularly pipeline vandalism, sabotage, and theft – continue to curtail flow. What’s clear is that Nigeria’s oil and gas infrastructure is aging, and while there are efforts to revive dormant fields and increase security, efficiency remains uneven across the board.
A Wave of Indigenous Control and Mega-Projects
What’s perhaps most exciting today isn’t just the reserves, but the shift in who is managing and benefiting from them. Indigenous firms have gone from being peripheral players to central actors in the upstream space. Seplat Energy’s acquisition of ExxonMobil’s shallow water assets in 2024 was a pivotal moment. With that deal, Nigerian operators now account for more than half of the country’s daily crude oil production. That kind of structural change has been long overdue, and it’s a signal to international investors that the landscape is no longer dominated by just the global supermajors.
Infrastructure is also undergoing a quiet revolution. The Dangote Refinery, now Africa’s largest, is operational with a refining capacity of 650,000 barrels per day. This single project has dramatically shifted the downstream narrative, with Nigeria now positioned to reduce its historic dependence on imported refined products and even begin exporting them at scale. Meanwhile, the long-anticipated NLNG Train 7 project is nearing completion, promising to boost liquefied natural gas capacity and solidify Nigeria’s role as a key LNG exporter. Equally significant is the Ajaokuta–Kaduna–Kano (AKK) pipeline, which is on track to deliver gas from the south to underpowered regions in the north, offering not just energy supply but economic opportunity.
These are not just vanity projects. They form the core of Nigeria’s strategic ambition to become an integrated energy powerhouse, leveraging upstream strength, midstream connectivity, and downstream capacity all at once.
Navigating Visa Challenges for Energy Investors in Nigeria
While Nigeria’s oil and gas sector offers considerable investment potential, access to the market is not without administrative hurdles, particularly when it comes to immigration procedures. One recurring pain point for foreign stakeholders, whether they’re project developers, engineers, executives, or technical consultants, is navigating the country’s often opaque and bureaucratic visa system.
The primary route for energy professionals entering Nigeria for business or technical support is the Subject to Regularisation (STR) Visa, followed by an expatriate quota approval and a Combined Expatriate Residence Permit and Aliens Card (CERPAC). These processes, while standard on paper, can be time-consuming in practice. Delays can stem from inconsistencies in documentation requirements, shifting interpretations by immigration officers, or simply a lack of clarity between federal and company-level expectations.
Moreover, for oil and gas companies operating under Joint Ventures or PSCs (Production Sharing Contracts), visa approvals are often tied to NNPC partnership compliance, making things even more nuanced.
From our extensive experience working with international energy clients, it is crucial that investors and executives plan immigration timelines alongside commercial milestones. In other words, visa planning should not be an afterthought; it must be embedded into early-stage project execution planning, especially when mobilising foreign staff to site or board-level meetings.
For those unfamiliar with the immigration landscape, we recommend reading our comprehensive Nigeria Visa Guide for Investors, where we break down STR, TWP (Temporary Work Permit), Business Visas, and more, including up-to-date timelines, documentation checklists, and our insights on avoiding common pitfalls.
Climate, Capital and the Question of Relevance
The elephant in the room, however, is the global energy transition. Nigeria’s Energy Transition Plan (ETP) outlines a route to net-zero emissions by 2060, but implementation remains patchy. There is real interest in hydrogen – both blue and green, as a potential future export. And there’s a serious conversation about reducing gas flaring and instead monetising that gas for domestic power generation and regional export.
But this transition is not just about technology; it’s about finance. Global capital is becoming harder to source for hydrocarbon projects. In response, Nigeria and a coalition of African states are proposing a US$5 billion Africa Energy Bank – a dedicated vehicle to fund gas and oil ventures without relying on the increasingly climate-conscious lending policies of international banks. It’s a bold but necessary step. In many ways, it underscores the gap between the developed world’s climate goals and the developmental realities of energy-poor countries like Nigeria.
What’s more encouraging is the country’s growing willingness to look inward for innovation. New policies are favouring local content, while energy diplomacy, such as the recent $1 billion Nigeria-Brazil deal, is bringing in new partners beyond the traditional Western blocs.
Nigeria vs Namibia: A Tale of Two Energy Frontiers
It is useful, at this point, to compare Nigeria’s trajectory with that of Namibia – a country that is fast becoming Africa’s most talked-about oil frontier. While Nigeria has the depth, infrastructure, and regulatory maturity that comes from over six decades of production, Namibia offers the freshness and high-stakes potential of a greenfield landscape.
Discoveries in Namibia’s Orange Basin by Shell (Mopane-1) and TotalEnergies (Venus-1), both of which hint at multi-billion-barrel potential, have attracted significant investor attention. Yet first oil in Namibia won’t flow until at least 2029. Infrastructure is minimal, and policy is still taking shape. For investors with long timelines and an appetite for frontier risk, Namibia may hold promise. But for those looking for active production, well-understood governance, and immediate cash flows, Nigeria remains the more grounded, albeit complex market.
What Foreign Investors Should Truly Consider
Foreign stakeholders entering Nigeria’s oil and gas sector should do so with a clear sense of its contradictions: it is both abundant and constrained, reformed and still bureaucratic, locally driven and globally dependent.
But in my view, that complexity is also its greatest opportunity. This is not a market where success is handed to you. It’s one where alignment with the right indigenous partners, a clear understanding of the Petroleum Industry Act, and an ability to navigate both state and local dynamics will define outcomes.
Nigeria is not trying to replicate the energy models of Europe or North America. It’s crafting its own version – one where hydrocarbons still have decades of relevance, where gas is a bridge not a destination, and where infrastructure, if properly managed, can transform both exports and local economies.
The key is not to view Nigeria through a post-oil lens, but rather through a multi-energy, multi-speed lens. It is both an oil giant and a gas underperformer, a place of legacy fields and untapped frontier blocks. To overlook it would be to miss the reality of how Africa will power itself and the world, in the years to come.
Written by Andreas Krensel, Managing Director, Africa and Europe
