Nigerian indigenous oil companies are making multi-billion dollar investments to develop divested onshore and shallow water assets, leading a new phase of growth and innovation in the oil and gas sector
Nigeria’s oil and gas sector is undergoing a significant transformation as local companies increasingly take the lead, injecting billions of dollars into developing previously abandoned fields and driving a new phase of growth and innovation.
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This strategic shift is being spearheaded by indigenous companies that have acquired onshore and shallow water assets from international oil majors.
A notable milestone in this trend is the recent commencement of loading operations on Monday, June 2, 2025, at Nigeria’s first locally developed and operated onshore crude terminal, Otakikpo.
Built by Green Energy International Limited and located in the OML 11 block near Port Harcourt, this $400 million facility has a 360,000 barrels per day (bpd) capacity and aims to unlock potential drilling prospects for over 40 stranded fields in the region. Shell loaded the first crude cargo from the terminal on Monday.
Similarly, Conoil Producing Limited recently shipped the first cargo of its new Obodo crude blend from the onshore OML 150 in the Niger Delta, with the cargo lifted by Oando Trading, a subsidiary of Oando Plc, which acquired ENI’s divested assets.
Following this trend of asset acquisition, Renaissance Africa Energy – which recently acquired Shell’s onshore assets – has committed to an impressive $15 billion investment over the next five years in its oil and gas operations.
The company aims not only to balance its portfolio by increasing crude oil production but also to double its gas output once a key local gas pipeline (likely the Ajaokuta-Kaduna-Kano (AKK) pipeline, as indicated by recent reports) is completed.
We are focused on reviving existing wells, expanding drilling campaigns, and increasing gas volumes.
Seplat Energy, another key indigenous player, has also announced robust plans following its acquisition of ExxonMobil’s Nigerian shallow-water assets.
CEO Roger Brown stated the company plans to reopen 400 previously shut-in wells and is set to invest up to $320 million this year in drilling campaigns and infrastructure.
This investment aims to boost crude production to approximately 140,000 barrels per day. “We are focused on reviving existing wells, expanding drilling campaigns, and increasing gas volumes,” Brown affirmed during the company’s annual general meeting.
These developments highlight the increasing role local producers are playing amidst government reforms.
Data from Nigeria’s oil regulator indicates that indigenous players now account for over half of Nigeria’s oil production, a significant increase from around 40% before the oil majors completed their divestment programs.
This growing indigenous capacity could provide crucial support for the government’s ambitious plan to raise overall oil output by an additional 1 million bpd next year.
Despite this promising shift, indigenous operators are still grappling with significant challenges.
Mikolah Judson, an analyst at global risk consultancy Control Risk, noted, “These operators face higher costs due to security challenges, community disputes, oil theft and ageing infrastructure – a key aspect of reducing costs for operators will be addressing these challenges.”
Nonetheless, the multi-billion dollar investments and operational milestones achieved by these local players signal a dynamic new phase for Nigeria’s oil and gas sector, positioning it for potential sustained growth and greater self-reliance.
