Nigeria is making a renewed pitch to global Engineering, Procurement, and Construction (EPC) firms to re-enter its oil and gas sector, promising that the obstacles that once drove them away have been dismantled.
Speaking at the EPC Deepwater Investment Roundtable in London, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, assured international operators and contractors that the country’s oil environment had been “reset” through policy reforms, regulatory clarity, and attractive fiscal terms.
Rebuilding Confidence in a Once-Troubled Market
For years, leading EPC contractors scaled down or exited Nigeria due to regulatory uncertainty, cost recovery disputes, project insecurity, and inefficient contracting structures. Lokpobiri acknowledged those concerns but insisted that the present framework tells a different story.
“Through the Petroleum Industry Act, we have streamlined fiscal policies, created transparency around contracts, and strengthened security collaborations with the Navy and other agencies,” the minister said. “The barriers of yesterday no longer exist.”
Linking EPC Participation to New Projects
Lokpobiri underlined that the return of EPC companies depends on operators moving forward with Final Investment Decisions (FIDs). Without active projects, he said, EPC contractors have little incentive to return.
“The pipeline of projects is critical,” he explained. “Operators must invest, projects must flow, and EPCs will follow. This is how we rebuild the ecosystem.”
Sweetening the Deal With Incentives
The government is banking on globally competitive incentives to reignite deepwater development. Provisions under the PIA include:
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Royalty rates as low as 5–7.5% for offshore production.
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Removal of cost-recovery caps, allowing companies to recoup development costs before profit sharing.
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Tax credits and allowances for frontier exploration.
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Strengthened investor protection and simplified contracting procedures.
Crucially, Lokpobiri stressed that EPC contractors would also benefit directly from these reforms—not just international oil companies.
“Deepwater projects cannot happen without EPCs. We are extending incentives to them as well, because they provide the expertise, the technology, and the execution capacity,” he said.
A Vast Opportunity in Deepwater
Nigeria’s deepwater basin remains largely untapped, and the government views it as the next big frontier for growth. Lokpobiri described it as “a massive space of opportunity” that could revive Nigeria’s production, enhance local content, and drive mutual prosperity for all players.
He urged EPC firms to reconsider Nigeria, not through the lens of past challenges, but as a transformed environment now structured for long-term stability.
“The government is deliberate about this,” he said. “We are not just opening doors; we are building partnerships that will last.”
Renewed International Interest
The London roundtable ended with fresh commitments between the government, EPC contractors, and deepwater operators to restart stalled projects and restore investor momentum.
Momentum is already visible. Recently, U.S.-listed Vaalco Energy announced interest in re-entering Nigeria by acquiring Svenska’s stake in Oil Mining Lease 145, signaling renewed confidence in the country’s investment climate.
