Nigeria has emerged as Africa's top destination for upstream oil and gas investments in 2024, according to market intelligence firm Wood Mackenzie. The country accounted for three out of four Final Investment Decisions (FIDs) announced by global oil and gas majors, with a combined value of $13.5 billion.
The investments include Shell’s $122 million Iseni Gas Project, TotalEnergies’ $566 million Ubeta Gas Project, and Shell’s Bonga North Tranche 1 project. These FIDs highlight Nigeria’s drive to unlock its hydrocarbon potential through strategic partnerships and investor-friendly policies.
The African Energy Chamber (AEC), which advocates for the African energy sector, commended Nigeria's proactive approach in attracting foreign investments. Several initiatives introduced in 2024 have created a conducive environment for investors.
Tax incentives for gas investments: Offering tax relief, reducing corporate income tax, and extending capital allowances for deepwater gas projects.
Presidential directives: The Presidential Directive on Local Content Compliance Requirements and the Directive on Reduction of Petroleum Sector Contracting Costs and Timelines have streamlined project implementation and cut down contracting timelines.
Licensing round: The launch of 19 exploration blocks in Nigeria’s 2024 oil and gas licensing round further demonstrates the government’s commitment to global partnerships.
These policies aim to reduce operating costs, accelerate project timelines, and attract up to $10 billion in natural gas investments, creating a more competitive oil and gas market in the country.
With 45% of Nigeria’s population lacking access to reliable electricity, the government’s initiatives and the announced FIDs are expected to drive universal energy access and socioeconomic development.
“Nigeria continues to set a benchmark for investor-friendly policies, leveraging its hydrocarbon potential and government initiatives to drive sustainable development,” said NJ Ayuk, Executive Chairman of the AEC. He praised President Bola Tinubu, Special Adviser on Energy Olu Arowolo Verheijen, and Nigerian energy stakeholders for fostering an environment that attracts global investments.
The AEC highlighted that Nigeria’s continued commitment to sustainable energy and addressing energy poverty aligns with its broader socioeconomic goals.
With the momentum gained in 2024, further FIDs are expected in the coming year, including TotalEnergies’ anticipated $750 million Ima Shallow Gas Project in 2025.
The African Energy Week: Invest in African Energy 2025 conference, scheduled from September 29 to October 3, will feature key Nigerian policymakers and energy stakeholders. This platform will showcase Nigeria’s growing investment opportunities in its oil and gas industry.
Nigeria’s proactive strategies and substantial hydrocarbon reserves continue to position it as a leader in Africa’s energy sector. The country's push toward sustainable energy development, coupled with its investor-friendly policies, promises to strengthen its role in the global energy market while addressing critical domestic energy challenges.
