•Despite tax law, operators face 270 taxes, charges
• Independents now account for over 60% of country’s production, says minister

Amidst dwindling investment in fossil fuel and years of struggle to boost oil production, Nigeria is seeking to attract $38 billion in fresh investment to raise crude oil production to three million barrels per day (bpd) by 2030.

The Federal Government bets on sweeping reforms, divestment to indigenous operators and improved investor confidence to revive Africa’s largest oil producer.

Coming amidst rising borrowing as oil revenue dwindles and budget deficits widen, the government, yesterday, at the 25th Nigerian Oil and Gas (NOG) Energy Week in Abuja said indigenous oil companies now account for more than 60 per cent of Nigeria’s daily crude production, marking a significant shift in the country’s upstream sector following the divestment of onshore assets by international oil companies (IOCs).

Special Adviser to the President on Energy, Olu Verheijen, said Nigeria had entered a new phase where attracting capital would depend less on its resource endowment and more on policy credibility, regulatory certainty and competitive project economics.

She disclosed that independent assessments indicate Nigeria requires about $38bn in additional financing to sustain existing production and achieve its 2030 targets of three mbpd of crude oil and 10 billion standard cubic feet of gas per day.

According to her, the competition for global investment has shifted beyond geology to governance, with investors increasingly evaluating countries based on policy consistency, regulatory efficiency and project bankability.

“Capital is no longer sentimental. It follows credibility,” she said, adding that Nigeria’s objective was to transform its vast hydrocarbon resources into industrial growth, electricity, petrochemicals, exports and jobs.

Verheijen argued that recent reforms had begun restoring investor confidence, noting that Nigeria had attracted more than $10 billion in final investment decisions (FIDs) over the past three years while crude and condensate production had risen by more than 400,000 bpd.

She also revealed that the country now has over $50 billion worth of upstream investment opportunities in the project pipeline, while external reserves have exceeded $50 billion, developments she described as evidence that improved policies were beginning to attract long-term capital.

However, despite the optimism, stakeholders warned that production targets would remain difficult to achieve without sustained investment, infrastructure expansion and continued improvements in the operating environment.

Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, dismissed suggestions that Nigeria’s production ambitions were unrealistic, insisting the country had previously produced 2.5 million bpd and possessed the capacity to return to those levels.

Current production, he said, has risen to over 1.8 million bpd, compared with about one million bpd a decade ago, although the output remained well below Nigeria’s installed capacity.

Lokpobiri credited recent reforms, improved security and stronger regulatory coordination for reversing production declines, while revealing that active investment leads in the sector had increased from about 40 in 2023 to more than 60.

According to the minister, Nigerian independents now contribute over 60 per cent of national production following the transfer of onshore assets from IOCs.

Rather than representing an exit from Nigeria, he argued, the divestments have enabled international companies to concentrate on deepwater exploration while allowing domestic firms to expand production from mature onshore fields.

He cited companies including Renaissance, Seplat and Oando as examples of indigenous firms evolving into major continental energy players capable of sustaining production growth.

The Nigerian National Petroleum Company Limited (NNPC Ltd) also noted operational improvements aimed at strengthening investor confidence.

Its Group Chief Executive Officer, Bashir Bayo Ojulari, said the company had reduced operating costs by $3.4 billion through contract optimisation while restoring average operational efficiency across Nigeria’s five crude export terminals to 98 per cent.

NNPC also reported crude production of 1.71 million bpd, the highest level in five years, with its exploration subsidiary producing a record 365,000 bpd.

Industry operators, however, cautioned that production growth alone would not guarantee broader economic benefits.

Chairman of the Independent Petroleum Producers Group (IPPG), Adegbite Falade, said Nigeria missed significant opportunities created by global energy disruptions during the Russia-Ukraine conflict because insufficient production capacity and delayed investments limited its ability to supply international markets.

He argued that Nigeria’s long-term competitiveness would depend not only on increasing crude output but also on expanding domestic gas utilisation, refining, petrochemical production and other value-added industries.

Despite the new tax law, which is meant to harmonise taxation and relief for investors, Falade called for reforms to reduce the burden of more than 270 taxes, levies and regulatory charges imposed across the industry, warning that high costs continue to undermine competitiveness and discourage investment.