Africa’s biggest oil producer is pressing ahead with one of its most ambitious upstream investment drives in years, even after more than a quarter of the oil and gas assets on offer failed to attract investor interest.
- Africa’s biggest oil producer has advanced 196 companies to the commercial bidding stage of its 2025 oil licensing round.
- However, 13 of the 50 oil and gas blocks on offer failed to attract investor interest and will return to the government’s licensing pool.
- The regulator believes the successful assets could add 500 million barrels to reserves and lift production by 300,000 barrels per day.
- The exercise comes as Nigeria enjoys its strongest crude production recovery in more than six years and prepares another licensing round in 2026.
Nigeria’s upstream regulator on Tuesday advanced 196 companies to the commercial bidding stage of its 2025 licensing round, but confirmed that 13 of the 50 oil blocks offered received no bids and will return to the government’s licensing basket for future auctions.
The outcome reflects both renewed confidence in Nigeria’s oil sector and the growing selectiveness of global investors, who are increasingly directing capital towards projects with stronger commercial prospects as competition for upstream investment intensifies.
The exercise comes at an important moment for Africa’s largest crude producer. After years of struggling with oil theft, pipeline vandalism, underinvestment and regulatory uncertainty, Nigeria has begun rebuilding production.
Last month, the country exceeded its OPEC crude production quota for the fourth consecutive month, recording its highest crude output since April 2020.
That recovery has strengthened Abuja’s push to attract fresh exploration spending and restore long-term production growth.
Speaking at the Commercial Bid Conference in Abuja, the Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Oritsemeyiwa Eyesan, said the licensing process drew interest from indigenous producers, international energy companies, existing operators and new entrants.
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Around 300 companies initially expressed interest in the licensing round. After prequalification, 196 applicants qualified for the commercial stage, while 143 companies eventually submitted 200 technical and commercial bids covering 37 assets.
The remaining 13 blocks attracted no qualifying bids and will be returned to the government’s portfolio for future licensing exercises.
Rather than rewarding only the highest financial offers, Eyesan said the commission deliberately prioritised operators capable of developing the assets.
“It wasn’t, and it isn’t, going to be just about your ability to be the highest bidder. We want to ensure that you have the right capabilities to deliver the asset, in addition to having the financial re
According to the regulator, companies were assessed on technical competence, operational experience, organisational capacity, project execution plans and financial strength.
Nigeria hopes fresh upstream investment will strengthen oil production and expand natural gas development.BI Africa
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Industry analysts have long argued that access to financing remains one of the biggest obstacles facing upstream investment in Nigeria.
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While the Petroleum Industry Act has improved regulatory certainty, investors remain cautious about committing capital to frontier assets amid volatile oil prices, higher financing costs and the global energy transition.
The absence of bids for 13 blocks illustrates that investors are becoming increasingly selective, preferring assets with clearer commercial potential and lower development risks.
The NUPRC estimates that the 37 contested assets could add around 500 million barrels to Nigeria’s proven reserves, which currently stand at 37.01 billion barrels.
If successfully developed, the fields could also increase crude production by another 300,000 barrels per day within three years.
That would provide a significant boost for Nigeria’s economy, where oil remains the country’s largest
It would also support President Bola Tinubu’s target of increasing crude production to 3 million barrels per day by 2030, helping Africa’s largest oil producer strengthen its position within OPEC after years of consistently missing production targets.
The latest licensing round spans assets across the Niger Delta, the Benin Basin, Anambra Basin, Chad Basin, Benue Trough, shallow-water acreage and one deep offshore block, giving investors access to both mature producing regions and frontier exploration areas.
Nigeria’s investment drive comes as African producers compete aggressively for global upstream capital.
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Countries including Angola are introducing new fiscal incentives to sustain production, while Namibia’s series of offshore discoveries has emerged as one of the world’s most attractive exploration frontiers.
At the same time, established producers across the continent are seeking fresh investment to offset declining output from ageing fields.
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Nigeria is also undergoing a major transition as international oil majors continue to sell onshore assets to indigenous operators, creating opportunities for local companies while reshaping ownership across the sector.
Government officials argue that reforms under the Petroleum Industry Act have made the country more competitive by improving transparency, simplifying regulation and increasing investor confidence.
Minister of State for Petroleum Re, Ekperikpe Ekpo, said new upstream investments would not only increase crude production but also strengthen Nigeria’s gas ambitions under the Decade of Gas Initiative
He said expanding exploration would support industrialisation, improve domestic gas supply and reinforce Nigeria’s position as one of Africa’s leading natural gas exporters.
Winning is only the first step
The regulator stressed that emerging as the highest commercial bidder does not automatically guarantee a Petroleum Prospecting Licence.
Successful bidders must still satisfy post-award conditions within 90 days, including paying signature bonuses, first-year rents, providing financial guarantees and executing all contractual agreements.
Eyesan also warned investors against warehousing licences without developing the assets.
“The award should not be a trophy. It shouldn’t be just a medal of honour. We expect that you’re going to work these assets.”
She disclosed that President Bola Tinubu has already approved the commencement of the 2026 licensing round, signalling that Nigeria intends to maintain regular bid rounds as part of its strategy to attract long-term investment into Africa’s largest oil industry.
Despite improving investor confidence, the sector continues to face pressure to address longstanding environmental concerns in oil-producing communities, where oil spills, gas flaring and ecosystem degradation remain major challenges alongside the country’s drive to increase production.
