#AfricanEnergyWeek: Oil firms in Nigeria divest $7b assets, says Oando CEO

About $7 billion worth of assets was divested to indigenous oil companies in the last eight years as the share of Nigeria’s oil production by local companies moved from 3 per cent to 30 per cent.

Chief Executive Officer of Oando, Wale Tinubu, disclosed this Tuesday at the African Energy Week in South Africa, as he revealed that indigenous energy companies are stepping up to acquire divested assets from International Oil Companies (IOCs), spearheading a new era of local industry leadership and economic empowerment.

Tinubu, while addressing the recent wave of divestments and acquisitions in the oil sector in Africa and their potential to reshape the continent’s energy future, said that from 2015 to 2023, African companies have acquired over $7 billion in oil and gas assets from IOCs.

The trend, Tinubu noted, represents a shift in focus as IOCs divest from high-risk regions in Africa to pursue lower-cost, high-return fields elsewhere.

Among these significant transactions are Seplat’s $1.2 billion investment in ExxonMobil’s Nigerian joint venture, Savannah Energy’s $407 million purchase of ExxonMobil’s Chad and Cameroon businesses, Panoro Energy’s $180 million acquisition of Tullow’s assets in Equatorial Guinea, Assala Energy’s $628 million acquisition of Shell’s onshore assets in Gabon, Chappel’s $860 million acquisition of TotalEnergies’ 10 per cent stake in SPDC JV, and others.

“This unprecedented shift marks a renaissance for African energy companies,” Tinubu said, adding that indigenous companies now account for 30 per cent of Nigeria’s oil production and control 40 per cent of the nation’s oil reserves.

The factors driving this transformation, according to him, include improved ease of doing business, the Petroleum Industry Act, strategic partnerships, and strengthened local content laws.

However, Tinubu said the hurdles indigenous companies face, particularly limited access to financing, political volatility, and technical capacity constraints.

He acknowledged that indigenous companies have limited financing options, especially since foreign banks that once heavily funded African oil and gas projects have gradually withdrawn support.

Tinubu expressed gratitude for African institutions like the African Export-Import Bank, which now provides critical financing support.

“We need more indigenous financial institutions with the capacity and commitment to help bridge the gap,” he added.

Tinubu, noting that the shift towards local ownership brings numerous benefits, said there are opportunities in regional infrastructure, strategic investment, employment generation, and local industry growth, positioning indigenous companies as stable producers in volatile markets.

“Africa’s oil and gas sector is rapidly evolving. Indigenous companies are ready and capable to lead, stabilising production levels and ensuring that resources benefit African economies,” he said.

Tinubu also called for African governments to support this transition by addressing regulatory inconsistencies and investing in technical and financial capabilities within the continent, adding that indigenous companies are well-positioned to focus on domestic development needs, something IOCs have often sidelined in favour of export-focused strategies.

Tinubu said: “Africa holds significant reserves, and it’s up to us to make sure these assets are developed efficiently, benefiting the local economy and people.” Looking ahead, Tinubu outlined Oando’s vision of a diversified future in Africa’s energy sector, particularly as indigenous companies expand into natural gas and renewables, helping to meet global decarbonization goals while leveraging Africa’s vast reserves.

“The future of Africa’s energy security lies in indigenous companies. With strategic investments and supportive policies, African countries can retain more value from their natural resources and drive sustainable growth,” he stated.