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Natural resources

Nigeria's Oil Minister Issues Ultimatum to Oil and Gas Operators

Strategic Insights

— 1 min read

Nigeria's Minister of State for Petroleum Resources (Oil), Sen. Heineken Lokpobiri, has issued a stern warning to oil and gas operators in the country, instructing them to re-enter shut-in wells and unlock dormant oil fields within a certain timeframe or risk losing their operating rights. This directive comes as Nigeria faces declining crude production and a target to increase output to 2 million barrels per day (bpd) by the end of 2025. Lokpobiri emphasized that the Federal Government will no longer tolerate non-performing assets in the upstream sector, particularly in light of the tightening global capital for fossil fuel projects. The Minister's statement was made during the 2025 Nigeria Oil and Gas Energy Week in Abuja.

Key Takeaways:

  • The Nigerian government has instructed oil and gas operators to re-enter shut-in wells and unlock dormant oil fields or risk losing operating rights.
  • The directive is aimed at eliminating non-performing assets in the upstream sector, which are seen as hindering national development goals and creating economic value.
  • Operators who hold upstream licenses without real investment, using them as financial leverage, are accused of economic sabotage.
  • The government is reviewing partnerships and license arrangements to ensure they align with national development goals and create economic value.
  • The Minister emphasized the importance of responsible partnerships, warning against holding assets hostage under the guise of Joint Venture partnerships.
  • President Bola Tinubu has tasked the NNPC Ltd. board with reviewing all operatorship arrangements to eliminate deadweight in the sector.
  • The government has introduced reforms to enhance investment appeal in the sector, including Executive Orders to streamline operations, fiscal incentives to attract investors, and regulatory simplification to ease approvals.

Statistics:

  • Nigeria aims to increase oil production to 2 million barrels per day (bpd) by the end of 2025.
  • Energy transition concerns are driving global financiers away from fossil fuels, making the directive more pressing.
  • Many previously awarded marginal fields and assets lie idle in Nigeria.

Sources:

  • Nigeria Oil and Gas (NOG) Energy Week 2025
  • President Bola Tinubu's directive to the NNPC Ltd. board
  • Executive Orders to streamline operations
  • Fiscal incentives to attract investors
  • Regulatory simplification to ease approvals

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