Nigerian Oil Minister Heineken Lokpobiri Joins African Energy Week (AEW) 2024 as Reforms Strengthen the O&G Market
Committed to developing Nigeria’s oil resources, the Minister’s keynote at AEW: Invest in African Energy will showcase investment prospects across the entire oil value chain.
Nigeria aims to increase oil production to 2.6 million barrels per day (bpd) by 2026 through the development of new fields and reinvestments in producing assets. As one of Africa’s largest crude oil producers with approximately 37 billion barrels of oil reserves, the country offers attractive opportunities for E&P players and financiers alike. During AEW: Invest in African Energy 2024, Minister Lokpobiri will outline the country’s strategic investment opportunities, connecting both active and potential companies to the growing market.
AEW: Invest in African Energy is the platform of choice for project operators, financiers, technology providers and government, and has emerged as the official place to sign deals in African energy.
To attract investment in oil and gas, Nigeria has initiated a series of measures to make the market attractive for foreign capital. A 2024-2026 Action Plan spearheaded by the Nigerian Upstream Petroleum Regulatory Commission aims to entice investment by implementing standardized tariffs and reducing signature bonuses for exploration blocks. These measures aim to not only make investment in Nigeria’s oil sector more financially viable but also to streamline regulatory processes, providing greater investor certainty and confidence.
This proactive approach by the regulatory commission is expected to cultivate a more conducive environment for investment, encouraging both local and foreign investors to participate in Nigeria’s oil industry.
Meanwhile, President Bola Tinubu issued new policy directives in March 2024 to incentivize foreign investment in the country’s oil and gas sector. The executive order introduces fiscal incentives, streamlines contracting processes, and promotes cost efficiency in local content development. The declaration is part of efforts to eliminate barriers to investments, leverage national resources, and diversify the economy for the benefit of all Nigerians.
These regulatory reforms are expected to entice further investment in the country and commitments are already being made. Notably, global oil majors committed to investing $13.5 billion in Nigeria in the short-term during a series of strategic meetings with Nigerian President Bola Tinubu.
Meanwhile, despite the recent decline in the country’s oil production, international oil companies have intensified their focus on upstream activities in Nigeria. Earlier this year, TotalEnergies commenced production at the Akpo West field offshore Nigeria, contributing 14,000 barrels of condensate per day. Concurrently, Chevron is intensifying its investments in Nigeria’s deepwater sector, initiating seismic data acquisition in multiple deepwater blocks and expanding the Agbami field project.
Furthermore, Chevron acquired a stake in offshore OPL 215 and extended three deepwater licenses for 20 years. These initiatives by international oil companies signal a revival in exploration and production (E&P) efforts, presenting opportunities for service providers, offshore drilling contractors, and national firms to participate in Nigeria’s deepwater resurgence.
Indigenous energy firms have also made efforts to develop Nigeria’s oil assets. For example, Oando PLC, a Nigerian energy company, secured an $800 million loan agreement with the African Export-Import Bank (Afreximbank) in November 2023. This agreement aims to bolster the company’s interests in key assets such as OML 60, 61, 62, and 63, located in the Northern Niger Delta region. Similarly, Torxen Energy Resources, another Nigerian exploration and production company, finalized a $75 million development agreement for Petroleum Production License (PPL) 241 with Afreximbank.
Signed during last year’s AEW in Cape Town, this deal facilitates capital investment for the drilling of two oil wells, constructing a new oil platform, and developing a pipeline.
“As one of the biggest oil and gas producers in Africa, Nigeria offers a wealth of investment opportunities for E&P players, service providers and project developers. Targets to produce 2.6 million bpd while distributing fuel across the region require substantial investments in exploration, production and downstream infrastructure. Minister Lokpobiri’s participation at the AEW: Invest in African Energy conference underscores the government’s proactive approach to growing the market,” states NJ Ayuk, Executive Chairman of the African Energy Chamber.
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Meanwhile, Mordor Intelligence notes that the Nigeria oil and gas downstream market – projected to grow from 1.14 million bpd in 2024 to 1.36 million bpd by 2029 – has rebounded despite regional lockdowns and volatile crude oil prices. The government’s commitment to a robust domestic refining industry and upcoming capacity expansions drives this growth, offering lucrative opportunities in Nigeria’s downstream sector.
The refining segment, led by projects like the Dangote Refinery is set to dominate the market, enhancing self-sufficiency and reducing import reliance. Recently, the Dangote Refinery secured its first crude shipment of one million barrels of Agbami crude grade from Shell International Trading and Shipping.
At the upcoming AEW: Invest in African Energy 2024 conference, Minister Lokpobiri will spotlight new initiatives to develop Nigeria’s oil sector. The country aims to attract more investment by promoting exploration projects, forming partnerships with energy companies, and readjusting its regulatory environment to attractive investments in its energy sector. Find out more at AEW: Invest in African Energy.
