Nigeria is the largest oil and gas producer in Sub-Saharan Africa and 13th largest in the world in 2021. First oil discoveries in the country were in 1956 and production began shortly after. Since then, the industry in the country has grown substantially, with resource finds from the onshore swamp area, to some of the deepest offshore exploration in the world. Nigeria is heavily reliant on its oil and gas sector for national revenues, but production volumes have fallen over the last few years due to ageing fields, along with a lack of investment as a result of uncertainty caused over the long-awaited petroleum industry bill (PIB). In 2021 the PIB was finally signed into law by President Buhari, and international oil companies gained some clarity on their futures in the country.

Crude oil and condensate production in the country is approximately 1.8 million barrels per day in 2021 and is forecast to decline steadily over the next five years. Beyond the forecast period, production may pick up as companies assess their positions in relation to the new bill and make investments over the next few years. Natural gas production in Nigeria is approximately 6,200 mmcfd and is forecast to continue rising as large gas projects are due to come online within the next five years, such as the joint development of the Assa North and Ohaji South fields, adding a further 600 mmcfd to the country’s output. Much of the new gas production for the country will go into supplying the Nigeria LNG plant as construction has begun on train seven.

GlobalData has estimated that Nigeria has approximately 8.2 billion barrels of crude oil and condensate remaining reserves from the producing, planned, and announced fields, including expansions. The largest of these announced fields are Owowo West and Bonga Southwest holding a combined 1.3 billion barrels of oil and 114,000 million boe of natural gas. Both of these fields weere discovered over ten years ago but have seen little movement towards FID since. It is also estimated that Nigeria has approximately 7 billion boe of natural gas remaining reserves.

Map of oil and gas fields in the Nigeria

Source: GlobalData Oil & Gas Intelligence Centre

Note: Oil and gas fields are shown as bubbles with bubble size indicating recoverable reserves.

Production and Development Outlook

In 2021, total production in Nigeria is forecast to decline by 3.5% as compared to 2020 production levels and is estimated to average around 2,800,000 boed. Nigeria’s crude oil and condensate production has declined steadily since the early 2000’s as their large fields were maturing.

The near-term outlook for Nigeria’s hydrocarbon production is due to decline throughout the forecast period, as the increase in natural gas production will not be sufficient to improve the declining crude oil and condensate production. The recently signed PIB has made the situation clearer for the IOCs and so we may see FID on some of the larger developments which had been put on the backburner over the past decade or so which would significantly improve the outlook for the country. However, with the rise of importance placed on the energy transition and cleaner fuels, IOCs internal emissions requirements on projects are becoming more strict and the required investment into various developments to meet these requirements may be off-putting.

Crude oil and condensate make up approximately 70% of the country’s production in 2021, which has been the makeup for a number of years. However, by 2025, natural gas is forecast to grow its market share within the country whereby crude oil and condensate is forecast to account for just 56%.

Despite the declining crude oil and condensate production in the country, the recently passed petroleum industry bill (PIB) was to overhaul the industry in the country by restructuring the national oil company, Nigerian national petroleum corporation (NNPC), which acts as a JV partner, operator, and regulator. The bill also includes chapters allowing host communities to hold an equity stake in the fields, and a reworking of fiscal terms giving pipeline investor a five-year tax holiday and allowances over tax deductibles. Although the rework is aimed at encouraging further investment to grow or at least maintain current levels of crude oil production, only time will tell if the major IOC’s will, considering pressure from investors to meet new emissions, reduction targets.

Many of the fields which would be able to significantly improve Nigeria’s production are pre-FID options and have seen multiple delays over the past decade. GlobalData has estimated that these fields could account for up to 250,000 barrels per day of crude oil and condensate by 2025, should they get the green light within the next year.


Exploration activity has been slow in Nigeria for a number of years now in large part due to the erosion of project economics and the outlook of ‘lower for longer’ pricing as well as the traditionally very active IOCs in the country slowing investment in the face of pipeline attacks, court cases with the government, and environmental issues.

Nigeria held a marginal bid round in 2020 covering over 50 marginal fields in an attempt to encourage the development of these small fields to increase production with the incentive for operators being the lower capital requirements for these fields.

Note: Analysis taken from GlobalData’s latest upstream report, Nigeria Exploration & Production, 2021.