Nigeria’s upstream oil and gas sector is staging a strong comeback, shedding years of investor hesitation and stalled projects as fresh capital flows return to the industry. In 2025, the country sealed $18.2bn in oil and gas investments through the approval of 28 new field development plans, a milestone that signals renewed confidence in Nigeria’s energy fundamentals and regulatory direction.
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, revealed this in Abuja while addressing stakeholders at the 9th Nigeria International Energy Summit 2026, describing the development as clear evidence that Nigeria is once again open for serious energy business.
Reforms reposition Nigeria on Africa’s energy map
According to Lokpobiri, Nigeria has re-emerged as Africa’s leading oil and gas investment destination, accounting for four of the seven major Final Investment Decisions (FIDs) announced across the continent between 2024 and 2025. He said the shift reflects deliberate policy choices rather than coincidence.
After years of declining output and capital flight, the sector began to stabilise following the full implementation of the Petroleum Industry Act (PIA). The law introduced clearer fiscal terms, predictable licensing processes and stronger regulatory oversight, creating the certainty investors require before committing long-term capital.
In addition, the Upstream Petroleum Operations (Cost Efficiency Incentives) Order 2025 helped ease cost pressures by offering tax credits and lowering unit operating costs, improving project economics across deepwater, shallow-water and onshore assets.
Production recovery gains momentum
The reforms are already translating into barrels. Lokpobiri disclosed that the launch of Project One Million Barrels in October 2024 delivered measurable gains within a year, lifting crude oil production to between 1.7 million and 1.83 million barrels per day about a 20 per cent increase from previous levels.
Operational activity also rebounded sharply. Active rig counts rose from just 14 in 2023 to over 60, while long-delayed divestments by international oil companies unlocked additional capacity. The transfer of onshore and shallow-water assets to indigenous firms added roughly 200,000 barrels per day to national output, accelerating local participation in the upstream value chain.
These developments, industry players say, show that idle assets are being reactivated and existing fields optimised under a more investment-friendly framework.
Lingering gaps test sustainability
Despite the progress, Lokpobiri acknowledged that structural challenges remain, particularly within the oil and gas services segment. He warned that poor interpretation of the Nigerian Oil and Gas Industry Content Development Act has encouraged the rise of under-capitalised engineering, procurement and construction firms, weakening execution capacity.
He also flagged Africa’s $120bn annual hydrocarbon import bill as a strategic failure, urging stronger support for the African Energy Bank, headquartered in Nigeria, to mobilise long-term financing for domestic energy projects.
Industry stakeholders at the summit agreed that Nigeria’s upstream recovery is real but fragile. They stressed that sustaining momentum will require consistent policy execution, reduced bureaucracy, competitive operating costs and deeper collaboration between government, indigenous operators and international partners.
For now, the numbers tell a compelling story: Nigeria’s oil and gas sector is no longer treading water, it is regaining depth, direction and investor trust.
