Nigeria’s oil and gas sector experienced a transformative year, marked by bold acquisitions, strategic partnerships, and significant investment decisions. These moves promise to reshape the nation’s energy landscape, bolster local players, and address long-standing industry challenges.
For Nigerians, the deals signal a shift towards indigenous control of oil assets, creating opportunities for economic growth and job creation. While global players retreat to offshore operations to avoid onshore risks, local companies are stepping up to fill the gap, demonstrating resilience and ambition.
Local Players Drive Growth Amid Global Divestments
In 2024, major international oil companies (IOCs), including Shell, TotalEnergies, and ExxonMobil, divested significant onshore assets to indigenous firms. Experts attribute this trend to persistent issues like pipeline vandalism and environmental concerns.
“International oil companies are prioritizing offshore projects, while local players are investing heavily in high-risk onshore operations,” said energy analyst Adebayo Adekunle.
Key acquisitions included Seplat Energy’s $1.2 billion purchase of ExxonMobil’s onshore assets, doubling its production capacity to 120,000 barrels per day. Similarly, Oando Plc acquired Nigerian Agip Oil Company (NAOC) from Italy’s Eni for $783 million, signaling a new era of indigenous leadership.
Landmark Deals in the Industry
1. Equinor’s $1.2 Billion Exit
Norwegian energy giant Equinor sold its 53.85% stake in OML 128, including a 20.21% share in the Agbami field, to Chappal Energies. The deal, finalized in December 2024, marks Equinor’s exit from Nigeria.
“This is part of our strategy to focus on markets where we can create more value,” said an Equinor spokesperson.
2. TotalEnergies Divests Onshore Assets
TotalEnergies is finalizing the sale of its 10% stake in the Shell Petroleum Development Company (SPDC) JV to Chappal Energies. In 2023, these assets accounted for 14,000 barrels per day, contributing 40% of gas to Nigeria LNG.
3. Shell Bets on Offshore with $5 Billion Investment
Shell Nigeria Exploration and Production Company (SNEPCo) approved a $5 billion final investment decision (FID) for the Bonga North deep-water project, expected to yield 350 million barrels of crude. Shell’s Integrated Gas and Upstream Director Zoë Yujnovich said, “This is a significant investment to maintain stable production.”
Indigenous Companies Lead a New Era
The rise of local firms like Seplat Energy and Oando Plc underscores the growing role of Nigerian players in shaping the industry.
Oando CEO Wale Tinubu hailed the NAOC acquisition as a victory for indigenous companies. “This is a new dawn for Nigeria’s energy sector. We’re taking destiny into our own hands,” he said.
Such deals signal a broader shift towards local empowerment, reducing Nigeria’s dependence on foreign energy firms.
Partnerships Bolster Industry Innovation
Collaboration was another hallmark of 2024. Saipem, alongside Nigerian firms KOA Oil & Gas and AVEON Offshore, secured a $1 billion contract to develop subsea infrastructure for the Bonga North project.
Similarly, NNPCL and TotalEnergies announced a $550 million partnership to develop the Ubeta oilfield (OML 58).
Future endeavours:
Nigeria’s energy industry is poised for a dynamic future. While global firms retreat from onshore operations, local players are capitalizing on these divestments, ensuring that the nation retains control of its oil wealth. The investments and partnerships of 2024 lay the groundwork for long-term growth, innovation, and sustainability.
