New market research forecasts that Nigeria’s offshore oil and gas production market will grow from $34.18 billion in 2023 to $47.03 billion by 2031. The study, conducted by Research and Markets, indicates a Compound Annual Growth Rate (CAGR) of 4.1% over this period.
Research and Markets, headquartered in Dublin, Ireland, was established in 2002 to connect businesses with valuable market insights and analysis, positioning itself as the world’s largest market research provider.
According to the report titled “Nigeria Offshore Oil and Gas Production Market Size and Forecast, Regional Share, Trend, and Growth Opportunity Analysis,” Nigeria’s production reached 552.84 million barrels of crude oil, including condensate, in 2023, underscoring the country’s vital role in the global energy landscape.
The report highlights that the offshore oil and gas sector in Nigeria continues to thrive, projecting an impressive market expansion driven by robust international demand. Crude oil remains the dominant segment, while transportation holds a significant share of the market. The power generation segment is also expected to grow, with a projected CAGR of 5.7%, fueled by rising demand for natural gas in electricity generation.
The competitive landscape analysis reveals major players like TotalEnergies and Shell Plc steering market growth through strategic mergers, acquisitions, and partnerships, which enhance outreach and address customer needs effectively. The report emphasizes that these strategies, along with product and service innovations incorporating advanced technology, are crucial for market expansion.
Additionally, the report notes a notable shift as Nigeria’s offshore oil and gas producers increasingly focus on exploring and producing offshore natural gas, aligning with national goals to enhance competitiveness in the market. The Petroleum Industry Act (PIA), enacted in August 2021, further illustrates the government’s commitment to rekindling investor interest in upstream development and fostering community welfare in oil-exploration regions.
The research highlights key drivers influencing Nigeria’s offshore oil and gas market, including growing international demand and government initiatives. It also identifies existing challenges and their implications for the industry, providing stakeholders with insights to develop long-term, actionable strategies.
This period is pivotal for Nigeria’s offshore oil and gas sector, with escalating growth prospects poised to shape the future of energy production and expand its global reach. The commitment to advancing the industry is clear, promising substantial economic and infrastructural development for the country and the continent.
While Nigeria has long been Africa’s largest crude oil producer, it has faced production disruptions that have sometimes relegated it behind Angola. Challenges in the past, including economic recessions and militant attacks on oil infrastructure, have impacted production levels.
With increasing demand for natural gas due to its lower carbon emissions compared to oil, Nigeria’s offshore oil and gas market is poised for further growth.
In recent developments, the federal government reiterated its commitment to creating a conducive environment for investors in the oil and gas sector. Senator Heineken Lokpobiri, Minister of State for Petroleum Resources, made this assurance during a meeting with Nicolas Terraz, President of Exploration and Production at TotalEnergies.
Lokpobiri commended TotalEnergies for its longstanding partnership in Nigeria’s oil sector and emphasized the government’s commitment to resolving any previous investment challenges. “We understand the importance of fostering an environment where investors can confidently expand their operations,” he stated.
During the meeting, Terraz expressed satisfaction with the government’s ongoing efforts to provide a stable and investment-friendly climate, highlighting TotalEnergies’ intentions to invest further in Nigeria, particularly in the Bonga North Offshore project and joint ventures with Shell Petroleum Development Company (SPDC) and the Nigerian National Petroleum Company Limited (NNPC).
These projects have recently received board approval, and Terraz noted that finalization of these deals is expected by the end of the year. “We remain committed to deepening our investments in Nigeria, especially with the opportunities presented by the Bonga North Offshore project and our partnerships with SPDC and NNPC,” he concluded.
