…Power, fertiliser, WAPG affected – Chevron’s CEO
…Loan defaults kill capital for all- Seplat’s CEO
Gaps in Nigeria’s gas pipeline infrastructure are constraining everything from power generation to fertiliser production and export capacity, according to senior oil executives, who say the lack of infrastructure is the country’s biggest barrier to electricity generation and industrial growth.
Speaking at the Nigeria International Energy Summit 2026 in Abuja, Jim Swartz, chairman and managing director of Chevron Companies in Nigeria, said the country’s ageing and limited gas pipeline network was preventing operators from monetising reserves and meeting domestic demand.
“Natural gas that goes into the domestic market goes through this [pipeline] system. It is constrained, there’s only one line, and it’s pretty old,” Swartz told industry leaders. “So we need to build that out. I think that’s one of the key things, to enable gas to move to the market and get to multiple places.”
The infrastructure bottleneck affects multiple sectors, he said, including domestic power generation, fertiliser production and the West African Gas Pipeline that supplies neighbouring countries. “I think gas infrastructure is really one of the key things,” Swartz added.
The warning comes as Nigeria targets increasing oil production to 2m barrels per day in the near term and 3m bpd in the medium term. But industry executives say achieving these goals will require not just production capacity but also comprehensive infrastructure development and massive capital investment, both of which remain elusive.
Read also: Nigeria eyes cost-reflective gas prices to unlock investment
Capital markets turning hostile
Roger Brown, chief executive of Seplat Energy, one of Nigeria’s largest indigenous producers, warned that loan defaults by oil companies were damaging the entire sector’s access to capital.
“We’re all chasing the same pots of capital, whether it be the African banks, whether it be the international banks, commodity-backed financing,” Brown said. “We have to be exemplary borrowers. We have to perform, we have to give good returns, and defaults have a massive impact on that pot of capital.”
According to Brown’s illustrations, “If one company borrows $100m with a 10 per cent cost of capital, it gives $10m a year in interest. But if that one company loses the bank $100m, we need 10 companies to make that money back up again. So defaults and provisioning of capital don’t help everyone.”
Despite these challenges, Brown pointed to improving investor sentiment. Seplat’s euro bond, priced at 9.125 per cent last year, now trades with an effective yield in the sevens, a 200 basis point improvement in 12 months. The bond is rated slightly above Nigeria’s sovereign rating by some agencies, reflecting growing confidence in well-managed operators.
“There’s a buzz,” Brown said. “The excitement’s there. The demand is there, and it’s that consistency of message.”
ExxonMobil commits $1bn
Against this backdrop, Jagir Baxi, chairman and managing director of ExxonMobil Nigeria, announced that the oil major expects to commit to a “sizable redevelopment effort” at its Usan deepwater facility later this year, in what industry sources suggest will be a $1bn investment.
The Usan field, which began production 14 years ago, is due for a redevelopment phase that Baxi said would demonstrate ExxonMobil’s renewed confidence in Nigeria’s investment climate following recent government reforms.
Baxi highlighted Esso’s efforts to improve reliability, performance, and lower cost of its Nigerian operations, enabling it to compete for funding globally.
He cited the example of the deepwater Usan field, where the company and its partners are preparing to commit $1 billion to capture 30,000 to 40,000 barrels of new production capacity, which will contribute meaningfully towards the national vision of 2 million barrels per day by 2027, and establish Usan as a hub for the development of adjacent discovered resources
“The federal government’s response in the last two years has created a very strong foundational framework,” Baxi said. “The obligation for an operator like us now is to pick that up and translate it to the known opportunities.”
He said ExxonMobil’s strategy was to improve the competitiveness of its Nigerian operations within its global portfolio, partly through the recent divestment of shallow water assets to focus on deepwater opportunities.
“Our view, especially for 2026, is that if we do achieve that first large opportunity with our partners, it will unlock the kind of capital we can bring to Nigeria,” Baxi said. “The very first one that gets unlocked will create the opportunity to then say, ‘This is what is now possible.'”
Read also: Turning gas export gains into domestic prosperity
Regulatory stability crucial
The executives were unanimous that regulatory consistency, introduced through the 2021 Petroleum Industry Act, was essential for unlocking investment. Chevron’s Swartz said his company had taken a different approach from peers by maintaining rather than divesting its swamp, shallow water and deepwater assets.
“What we do is we invest for the long term. These are not short-term investments,” he said. “Sanctity of contract, consistency of regulation, as the opening presentation talked about, is so important.”
He outlined a three-pronged investment strategy: improving reliability and infill drilling in legacy joint venture portfolios; developing discovered gas resources for both export and domestic markets with cost-reflective pricing; and pursuing new deepwater developments enabled by recent government incentives.
Chevron has a drilling rig scheduled for the Agbami field later this year for appraisal and development wells, and operates two rigs in shallow water for ongoing development.
Indigenous operators seek scale
Indigenous oil companies, which have acquired numerous assets from divesting international majors in recent years, face particular challenges in accessing the capital needed to scale production.
Ainojie “Alex” Irune, executive director at Oando and managing director of Oando Energy Resources (OER), said the industry needed to reconsider traditional funding sources.
“We may need to turn that on its head and find ways in which we can leverage more the government-to-government perspective,” Irune said. “Looking at how we can get support, potentially significant support from the East.”
He suggested international oil companies might need to provide “patient capital” that recognises the long gestation periods and technical risks involved in Nigerian oil development.
Tony Attah, chief executive of Renaissance, argued that indigenous operators brought crucial advantages in community relations that could reduce operational disruptions that have plagued the sector.
“We have homegrown solutions. We’re part of that ecosystem, and we understand how the communities, how the social fabric is woven,” Attah said. Renaissance has established 33 host community development trusts with about N90bn ($80m) deployed, putting development decisions in local hands rather than imposing blanket solutions.
Read also: Inconsistent regulations blocking investments in oil, gas industry – NUPRC boss
Local content balancing act
Lanre Kalejaiye, chief executive of ND Western, said local content requirements needed to be balanced with cost competitiveness and execution capability.
While local contractors have developed strong capabilities in areas like civil works, more technical services such as directional drilling still require international expertise, he said. “It’s not just local content at any cost, it’s performance-led local contractors who can perform, and how can we work with them to build that capability.”
The executives said regular coordination between operators, the Nigerian National Petroleum Company and regulators through monthly meetings was helping align policy with commercial decisions, an approach they believe is essential for achieving the country’s production ambitions.
