Indigenous Operators Now Produce Over 50% of Nigeria's Crude, FG Says

Indigenous oil and gas operators now account for more than 50 per cent of Nigeria's crude oil production, the Federal Government said on Wednesday in Abuja.

Minister of State for Petroleum Resources (Oil) Senator Heineken Lokpobiri disclosed this at the maiden Petroleum Technology Development Fund (PTDF) Journal Summit 2026. He was represented by his Technical Adviser, Engr. Emmanuel Sinime.

Lokpobiri tied the shift to major divestment deals by international oil companies, which he said opened room for local operators to expand in the upstream sector.

Production, Rigs and Investment

He said crude output has risen from about one million barrels per day in 2023 to more than 1.7 million barrels per day. Active drilling rigs moved from about 14 to more than 60, while the country has attracted over $10 billion in foreign direct investment in recent years.

"Significant progress has also been made in restructuring the industry by completing major divestment transactions involving international oil companies," he said.

"These transactions are creating great opportunities for indigenous operators who now account for more than 50 per cent of Nigerian crude oil production, a historic milestone for our industry."

Lokpobiri, however, said higher output must be matched by adequate infrastructure, efficient transportation and storage systems, expanded refining capacity and a competitive market that delivers value to consumers and investors.

He pointed to the Dangote Petroleum Refinery and a growing list of modular refineries, including Waltersmith and Aradel, as evidence of private-sector impact downstream.

Gas Push and Investment Constraints

Minister of State for Petroleum Resources (Gas) Ekperikpe Ekpo said private capital, technical expertise and innovation are critical to unlocking Nigeria's gas resources.

Ekpo said the government is committed to an enabling environment for private investment across the petroleum value chain, adding that the Petroleum Industry Act has provided a framework for regulatory certainty and institutional governance.

He said the Decade of Gas initiative aims to turn Nigeria into a gas-powered industrial economy, with natural gas as a catalyst for industrialisation, job creation, energy security and economic diversification. That, he said, will require sustained investment in gas processing, transportation and distribution infrastructure, plus liquefied petroleum gas, compressed natural gas, petrochemicals and other gas-based industries.

"The Federal Government cannot achieve this objective alone. We must continue to deepen collaboration with private investors, financial institutions, technology providers and other stakeholders to mobilise the capital and expertise required to deliver these projects," Ekpo said.

He listed infrastructure gaps, high financing costs, project development risks, regulatory bottlenecks and inadequate access to reliable energy infrastructure as constraints to private-sector participation. He also called for more investment in indigenous technological capacity, local manufacturing and skills development.

PTDF, Skills and Pipeline Projects

PTDF Executive Secretary Prof. Shuaibu Aliyu said the summit was designed to expand the Petroleum Technology Development Journal beyond research publication into dialogue, collaboration and practical solutions for the industry.

Aliyu said growing private investment in refining, gas processing, logistics, storage and product distribution presents opportunities for growth, job creation, technology development and local capacity building. He said PTDF wants research outputs to move into application, intellectual property development and commercialisation.

Waltersmith Petroman Oil Limited Managing Director Mr Oladapo Filani said PTDF has sponsored more than 15,639 scholars across various programmes and higher institutions, while supporting over 50,000 research projects and numerous collaborations with industry and higher institutions.

Filani said the challenge is no longer just producing skilled Nigerians but retaining expertise and creating opportunities for professionals to solve local problems. He named infrastructure deficits, human capital and technical capability gaps, financing, commercial viability and investment uncertainty as major midstream and downstream challenges.

He also cited constraints in gas gathering and processing, pipelines, storage and terminals, refining support infrastructure and product logistics. Pipeline vandalism, crude theft and integrity issues continue to disrupt supply, he added.

Filani said investments by the Federal Government and NNPC Limited in strategic infrastructure, including the Ajaokuta-Kaduna-Kano, Oben-Oben and OB3 pipeline projects, are important steps towards strengthening Nigeria's gas infrastructure.