Nigeria is sitting on oil and gas blocks that could bring in huge revenue, yet many of them have been left idle for years. At a recent energy event in Abuja, experts said putting these blocks to use could be a game changer for the country’s economy especially if Nigeria hopes to achieve its 7 percent GDP growth target.
Industry players say several things are holding back development, including a lack of funding, poor technical know-how, regulatory red tape, and long-running legal issues. These challenges have stopped Nigeria from turning its vast oil and gas resources into real value.
Untapped oil, untapped opportunity
Nigeria has 37.2 billion barrels of crude oil reserves and 210 trillion cubic feet of natural gas, but many of these resources are still underground. Some big oil projects like Zabazaba, Bosi, and Ude which could produce between 80,000 and 150,000 barrels per day have never moved forward.
Experts say the country urgently needs to unlock these projects to raise production, increase earnings, and support its economy. But doing that won’t be easy. It will require clear and consistent policies, better planning, and a stronger commitment from government agencies.
Even though the Petroleum Industry Act (PIA) was passed in 2021 to improve the sector, the benefits have yet to be seen. Poor rollout of the law, plus fights between government bodies, have made it harder for investors to trust the system.
The cost of red tape
Some industry insiders say corruption and delays are still common when trying to get licences and approvals. Despite the PIA, they claim regulators are still slow and, at times, demand bribes to speed things up.
Energy economist Adeola Adenikinju said key parts of the PIA haven’t been fully rolled out and timelines are being ignored. Approvals still take too long and can be confusing because of overlapping duties between agencies.
This creates uncertainty and drives away investors, especially those who want long-term, stable projects. Many fear that slow approvals and unclear rules will continue to delay much-needed oil investments.
Making gas work for Nigeria
Former Minister of Power Barth Nnaji said Nigeria needs to focus more on its natural gas. The country ranks ninth in the world for gas reserves, yet millions of Nigerians still lack access to electricity. While Nigeria exports some gas to Europe, Nnaji believes the domestic market should come first.
He said more gas should be used to power Nigeria’s homes and businesses. To reach the government’s dream of building a $1 trillion economy, Nigeria must make gas work for its own people first.
Use it or lose it
To stop oil fields from lying idle for decades, the Nigerian government is now taking a tougher approach. Under the PIA’s “drill or drop” rule, companies that don’t start work on their blocks risk losing them.
Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, said Nigeria can no longer afford to let valuable oil fields sit untouched. More licensing rounds are being prepared, including one in 2025 after last year’s bid round saw 25 blocks awarded.
Winning investors back
But making oil blocks available isn’t enough. Experts say the government must also fix the investment climate. That means reducing corruption, speeding up licence approvals, and creating a system investors can trust.
Legal expert Dapo Akinosun said the long process of getting approvals is not just costly, but discouraging. When investors face endless delays and uncertainty, they often walk away.
In February 2024, President Bola Tinubu signed three Executive Orders aimed at fixing some of these issues. The orders now limit the contracting process to six months and cut out duplicate approval steps. NNPC and other agencies must now give final approvals within 15 days.
This should help fast-track projects and reduce costs, but experts say strict penalties are still needed to make sure these timelines are followed.
Nigeria has the oil and gas it needs to support its economy but it also has a choice to make. It can continue to let red tape and poor planning hold things back, or it can unlock the full value of its idle oil blocks. The country’s path to real growth might just start underground.
