Month: September 2025

ExxonMobil Bets On Nigeria’s Deepwater Oil Fields With A $1.5billion Investment Between Q2 2025-2027

ExxonMobil sequel to its divestment of its onshore assets to Seplat Energy, has affirmed its long-term commitment to Nigeria’s oil and gas sector with a planned $1.5 billion investment in deepwater exploration and development projects, a move set to reinforce confidence in the country’s upstream potential. 

The planned investment, which will be executed between Q2 2025 and 2027, will focus primarily on revitalizing production at the Usan deepwater oil field. 

The oil major has indicated that a Final Investment Decision (FID) is expected in late Q3 2025, pending the final approval of the Field Development Plan (FDP), along with internal and partner funding approvals. 

In addition to the Usan field, ExxonMobil also revealed intentions to accelerate development activities in other key deepwater assets, including the Owowo and Erha fields. These developments are part of a broader strategy to strengthen its operational footprint in Nigeria and support the country’s drive for increased production. 

ExxonMobil expresses support for NUPRC’s “Project 1 million Barrels” initiative  

Mr. Harris also expressed ExxonMobil’s support for NUPRC’s “Project 1 Million Barrels” initiative, which aims to boost Nigeria’s crude oil production capacity to 2.4 million barrels per day in the medium term. He emphasized the importance of strategic collaboration between operators and regulators in achieving this ambitious target. 

Responding to the development, the CCE of NUPRC, Engr. Gbenga Komolafe welcomed the announcement, describing ExxonMobil’s renewed commitment as timely and crucial for Nigeria’s upstream growth. He reiterated the Commission’s role in facilitating a stable and transparent regulatory environment, citing the importance of investor confidence in the success of the Petroleum Industry Act (PIA) reforms. 

The discussions during the courtesy visit also touched on key sectoral issues, including compliance with the Domestic Crude Supply Obligation (DCSO) and the enforcement of Section 109 of the PIA, which introduces the principle of “willing buyer, willing seller” for crude oil transactions within the domestic market. In his new capacity as Chairman of the Oil Producers Trade Section (OPTS), Mr. Harris pledged to use the platform to foster stronger collaboration between industry players and the NUPRC, with a focus on addressing regulatory challenges and unlocking further investment opportunities in the sector. 

ExxonMobil’s renewed capital injection into Nigeria’s deepwater assets is expected to stimulate job creation, technology transfer, and increase national oil production, ultimately contributing to improved foreign exchange earnings and energy security. 

Afreximbank launches $3 billion Revolving Oil Trade Financing Programme to boost
Intra-African, Caribbean petroleum trade.

This initiative, aimed at boosting the purchase of refined petroleum products between African and Caribbean countries is designed to address Africa’s significant reliance on imported refined petroleum products from outside the continent, which currently costs approximately $30 billion annually due to insufficient local refining capacity. 

Key aspects and expected impacts of the program include: 

• Promoting Intra-African and Caribbean Trade: The program specifically finances the purchase of refined petroleum products by African and Caribbean oil buyers from refineries operating in Africa. This is expected to facilitate trade flows within these regions, reducing dependency on extra-regional imports. 
• Leveraging Growing Refining Capacity: Afreximbank has been a major financier in developing refining capacity across Africa. This program aims to leverage these investments, such as the Dangote Refinery in Nigeria, the Lobito and Cabinda Refineries in Angola, and the refurbishment of the Port Harcourt Refinery, among others. The bank aims to help create over 1.3 million barrels per day (bpd) of refining capacity in Africa, transforming the Gulf of Guinea into a significant refining hub. 
• Revolving Facility: As a revolving facility, the $3 billion is expected to finance a much larger volume of trade, estimated between $10 billion and $14 billion in intra-African petroleum imports over time.
• Targeted Beneficiaries: The program will primarily provide critical trade finance to oil traders (both African and international), banks, and governments (including their ministries of finance or petroleum/energy and state-owned enterprises) mandated to import refined petroleum products.
• Product Focus: The key products covered include Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), Heavy Fuel Oil (HFO), Jet Fuel, and Kerosene. 
• Alignment with AfCFTA: This initiative strongly aligns with the objectives of the African Continental Free Trade Area (AfCFTA) agreement, aiming to facilitate intra-African trade, promote industrialization, and create jobs.
• Energy Security and Economic Resilience: By strengthening regional value chains and reducing import dependency, the program seeks to advance energy security and foster economic resilience within Africa and the Caribbean.

• Multiplier Effect: Beyond direct trade, the program is anticipated to have a multiplier effect on the downstream petroleum value chain, catalyzing investments in shipping, marine logistics, cargo insurance, and other ancillary services.

Afreximbank continues to play a significant role in promoting trade and economic integration across Africa and with the Caribbean through various initiatives, including the Pan-African Payment and Settlement System (PAPSS) and the AfriCaribbean Trade and Investment Forum.

Nigeria’s power sector is set for a potential transformation with the establishment of the National Integrated Electricity Policy. This policy, aimed at reshaping the country’s power sector, has already been set in motion, addressing key issues impacting growth within the industry.

The policy, backed by the revised Electricity Act of 2023, offers a glimmer of hope for a sector plagued by persistent challenges. From grid limitations to mounting debts, the power sector in Nigeria has long been at a crossroads, seeking sustainable solutions to enhance electricity generation, distribution, and overall efficiency. One of the critical focuses of the policy is to introduce new players into the sector’s value chain, with states like Lagos gearing up to enhance their regulatory framework to attract investments and improve tariffs.

Additionally, the policy recognizes the importance of incorporating newer sources of electricity, particularly renewable energy, to diversify the energy mix and increase reliability. However, amidst the optimism surrounding the new policy, there are pressing issues that demand immediate attention. The staggering debt owed by generation companies stands at a monumental $4 trillion, posing a significant threat to the sector’s stability and future growth. This debt, accumulated over time, highlights the financial strain experienced by key players within the industry.

The government’s commitment to clearing this debt and providing assurances to stakeholders is a crucial step towards resolving this critical issue. The policy’s call for cost-reflective tariffs and targeted subsidies for low-income consumers aims to create a more equitable and sustainable pricing framework. However, the implementation of these measures must be accompanied by improvements to the grid infrastructure to ensure reliable power supply across all consumer segments. Despite the challenges ahead, there is a growing recognition of the need to prioritize grid enhancement to meet the increasing demands of consumers and businesses.

The urgency to ‘fix the grid’ resonates as a core theme in discussions about the future of Nigeria’s power sector. While the timeline for grid improvements remains uncertain, stakeholders emphasize the paramount importance of this initiative for the sector’s viability and long-term success.

As the government explores various options to address the mounting debt and enhance the sector’s performance, a comprehensive strategy that includes fiscal discipline, infrastructure investments, and stakeholder collaboration will be essential. Private sector industry operators recommend cost-cutting measures within the government as a precursor for broader systemic changes required to drive sustainable growth in the power sector.

In conclusion, the Nigeria’s National Integrated Electricity Policy signifies a pivotal moment in the country’s energy landscape. Nigeria has the opportunity to unlock its power sector’s potential and pave the way for increased efficiency, reliability, and investment.

 

For further enquiries, kindly contact the F.O. Akinrele & Co. Energy, Oil & Gas and Natural Resources Group

Adedoyin Odelana – adedoyin_odelana@foakinrele.com

Jeremiah Adegboro – jeremiah_adegboro@foakinrele.com