Inside Nigeria’s bold strategy to double oil production

Nigeria’s oil and gas sector is undergoing a seismic transformation. Buoyed by a government eager to reassert the country’s place on the global energy map, a fresh wave of reforms, strategic partnerships, and ambitious infrastructure projects is reshaping Africa’s largest oil-producing nation.

The centerpiece of this shift is a bold strategy to double oil production and unlock the full potential of Nigeria’s vast natural gas reserves.

The recent Gas Sales and Purchase Agreement (GSPA) signed between the Nigerian National Petroleum Company Limited (NNPC) and energy giants Shell, TotalEnergies, and Eni marks a watershed moment in this journey.

The agreement secures 270 million standard cubic feet of gas per day (mmscfd) to power the proposed $3.5 billion Brass Fertiliser and Petrochemical Plant in Bayelsa State—an industrial behemoth expected to generate $1.5 billion in annual export revenue.

But this is more than just another high-profile deal. It is a signal that Nigeria is shifting gears from being an oil-dependent economy to a more gas-led, diversified energy powerhouse.

A New Era of Gas-Driven Growth

At the heart of Nigeria’s new energy strategy is natural gas, a resource the country holds in abundance, with proven reserves of over 200 trillion cubic feet. Long underutilised, gas is now being positioned not just as a transitional fuel but as the engine of industrialization, power generation, and export revenue.

This agenda came into sharp focus at NOG Energy Week 2024, a gathering of industry stakeholders, policymakers, and investors. A standout panel session titled “Accelerating Investment, Enabling Industry Growth, Meeting Energy Demand” laid out a pragmatic roadmap to fast-track investment, de-risk capital, and expand infrastructure in both gas and deepwater oil segments.

Heineken Lokpobiri, Nigeria’s minister of state for petroleum resources, summarised the country’s approach: “Our goal is simple, create an environment where investors see Nigeria not as a risky frontier, but as a strategic partner in the global energy transition.”

Indigenous firms making bold moves

Nigeria’s indigenous oil and gas firms are making bold moves that are steadily reshaping the country’s energy landscape. Once considered marginal players, these local companies are now emerging as major industry drivers, building critical infrastructure, acquiring strategic assets, and innovating in ways that enhance energy independence and economic resilience.

Until recently, discussions around Nigeria’s energy sector centered largely on multinational corporations, pipeline sabotage, and asset divestments.

Today, however, the narrative is being rewritten by a new generation of Nigerian firms that are not only acquiring upstream assets but also investing heavily in midstream and downstream capabilities.

Companies like Green Energy International, Seplat Energy, Conoil, Heirs Energies, Aradel Holdings, and Waltersmith Petroman are leading this transformation.

One of the most groundbreaking developments is the launch of Nigeria’s first indigenous onshore oil export terminal in over a decade by Green Energy International. Located on OML-11 near Port Harcourt, the $400 million Otakikpo terminal is fully privately funded and designed to handle 250,000 barrels per day.

The facility aggregates output from 40 marginal fields, reducing evacuation costs by 40% and avoiding the risks associated with sabotage-prone infrastructure like the Trans-Niger Pipeline. Global confidence in the project was underscored when Shell became the first company to lift cargo from the terminal.

Across 2024 and 2025, at least 11 major milestones by indigenous firms illustrate this rising wave of self-reliant energy development. Conoil’s introduction of the new “Obodo” crude grade in May 2025 marked the first such launch in six years.

Meanwhile, the Madu Field, developed by a joint venture between FIRST E&P and NNPC, came online in April 2024, lifting production at the Anyala-Madu cluster to 60,000 barrels per day, making it Nigeria’s largest locally-led offshore project.

Seplat Energy has commissioned its 300 million standard cubic feet per day ANOH gas plant and committed $320 million in oil capital expenditure for 2025, targeting 140,000 barrels per day in oil production while providing gas to an estimated five million people.

Also, Oando PLC has taken over ENI’s NAOC stake and successfully marketed the Obodo crude through its trading arm, demonstrating a fully indigenous value chain from production to export.

Renaissance Africa also acquired Shell’s onshore assets and pledged a $15 billion investment over five years, one of the largest by a local player in recent memory.

Fiscal Reforms: Unlocking Investor Confidence

One of the cornerstones of Nigeria’s strategy is fiscal recalibration. In the same month as the GSPA announcement, the federal government unveiled a suite of incentives aimed at making Nigeria more attractive to energy investors. These include VAT waivers on gas, diesel, electric vehicles, and clean cooking solutions, alongside tax credits for new investments in deepwater oil and gas exploration.

These reforms directly tackle long-standing investor concerns about regulatory unpredictability, high costs, and bureaucratic red tape.

“By recalibrating the fiscal regime, Nigeria is sending a clear message to the global market: we are open for business, and we are serious,” said Wumi Iledare, a professor of petroleum economics.

Challenges in the Shadows

Despite the bold ambitions, significant challenges remain. Infrastructure is perhaps the most pressing. Nigeria’s gas pipeline network, though expanding, is still underdeveloped. The Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline, a critical project aimed at boosting domestic gas usage, is still under construction. Without rapid progress on such infrastructure, even the best-laid investment plans could falter.

Adebayo Alamutu, Petroleum policy analyst noted, “Securing supply agreements is only the first step. The real challenge lies in building and maintaining the infrastructure to deliver that gas reliably and efficiently.”

Funding is another major hurdle. Large-scale infrastructure and upstream development projects require capital,and lots of it. With global competition for energy investment intensifying, Nigeria must do more to position itself as a viable, stable destination for funds.

Then there’s the matter of environmental sustainability. “Greenhouse gas emissions from Nigeria’s oil sector continue to pose serious concerns,” said Dr. Adeola Yusuf, an oil and gas policy researcher. “Balancing economic growth with environmental responsibility will be key. Strengthening environmental regulations and investing in cleaner technologies are no longer optional, they’re essential.”

Volatility in global oil prices further complicates long-term planning. With prices affected by geopolitical crises, demand shocks, and OPEC+ decisions, Nigeria’s revenue streams remain susceptible to forces beyond its control.

Strategic solutions

To address these issues, the government is ramping up its focus on strategic initiatives.

Top of the list is public-private partnerships. The GSPA with Shell, TotalEnergies, and Eni is a template Nigeria hopes to replicate across multiple projects. Such partnerships help bridge funding gaps while transferring technological expertise and operational excellence to local players.

Regulatory clarity is also improving, with the implementation of the Petroleum Industry Act (PIA), a long-awaited overhaul of Nigeria’s oil and gas legal framework. The PIA offers clearer terms for investors, a more transparent governance structure, and incentives tailored to specific segments of the industry.

Another major focus area is domestic gas utilisation. Nigeria is pushing for increased gas use in power generation, manufacturing, and transportation. Projects like the Brass Fertiliser Plant will not only create jobs but also help reduce the country’s dependence on oil exports.

“This is about energy security as much as it is about economic diversification,” said Dr. Yusuf. “A robust domestic gas market creates resilience against external shocks and opens up new sectors for growth.”

Economic and Social Impact

The potential benefits of Nigeria’s new energy strategy are far-reaching.

First, there’s revenue. The GSPA-backed Brass Plant alone is projected to bring in $1.5 billion annually, a much-needed boost for Nigeria’s foreign exchange reserves.

Then there’s employment. The plant is expected to generate thousands of direct and indirect jobs, from construction and operations to logistics and services. In a country where unemployment remains a pressing concern, such large-scale projects could be transformative.

There’s also the broader economic multiplier effect. By expanding the gas sector, Nigeria lays the foundation for downstream industries such as petrochemicals, fertilizers, and power, fostering a more resilient and diverse economy.

Road ahead

As the world moves toward cleaner energy sources, Nigeria is walking a tightrope between maximising its fossil fuel resources and positioning itself for a lower-carbon future. The 2025 NOG Energy Week will likely serve as a litmus test for how far the country has progressed, and how much further it needs to go.

Implementation will be key. That means ensuring that approved incentives are not only rolled out but monitored. That means fast-tracking critical infrastructure. And above all, it means fostering an environment where private capital feels safe and returns on investment are competitive.

The Gas Sales and Purchase Agreement is a milestone, not the destination. Nigeria’s energy renaissance hinges on translating policy into action, investment into infrastructure, and agreements into economic dividends.

For a country with abundant resources and a youthful population, the stakes couldn’t be higher. But if current momentum is sustained, Nigeria could indeed double its oil production and cement its role as a gas-powered economic giant, not just in Africa, but on the global stage.