Nigeria’s oil and gas sector is staging a turnaround following years of declining production supported by the recent regulatory and fiscal reforms. These developments are strengthening investor confidence, encouraging upstream activity and repositioning Nigeria to realise its significant potential—anchored by the landmark Petroleum Industry Act (PIA), 2021.
The PIA, and ongoing positive reforms, has marked a watershed moment for the Nigerian oil and gas sector as the government works to enhance legal and regulatory clarity and operational consistency across the upstream sector. At a time when global investment is increasingly selective, Nigeria’s reform-led approach is restoring confidence in its upstream sector.
Regulatory and fiscal reforms: Building momentum
Alongside the government’s broader drive, reforms such as streamlined licensing, digitalised regulatory processes, and stronger public engagement to promote transparency are taking shape, all of which are repositioning Nigeria as a competitive force on the global upstream stage.
A notable recent example is the Upstream Petroleum Operations (Cost Efficiency Incentives) Order—May 2025, which ties tax relief to cost-efficiency benchmarks, enabling operators that outperform to reclaim a shared portion of government gains. The impact has been swift. In 2025 alone, Nigeria has approved 28 new field development plans (FDPs), mobilising some $18.2b in upstream investments and unlocking 1.4b bl of oil and 5.4tcf of gas.
Meanwhile, macro indicators are aligning—foreign reserves have been bolstered and Nigeria’s fiscal consolidation trajectory is being supported by multilateral partners. The African Development Bank has pledged $500m in 2025 to back the government’s budget under its reform umbrella. The World Bank notes that Nigeria’s GDP growth in H1 2025 reached c.3.9 %, aided by reforms including fuel-subsidy removal, tax adjustments and unified exchange rates. These are not oil-only metrics; they reflect deeper confidence in governance and macroeconomic stability, which provide critical tailwinds for upstream investors.
Meren Energy’s role: Partner to the majors in deepwater fields
For Meren Energy (formerly Africa Oil), the timing could not be more opportune. Our strategic positioning as a partner to the majors in Nigeria’s largest deepwater fields (Akpo, Egina and Agbami fields) places us at the confluence of reform momentum and increased capital deployment. As the cost-efficiency regime rewards disciplined execution, Meren’s emphasis on operational excellence, reservoir optimisation and disciplined capital allocation positions us as a credible partner in deepwater ventures such as the Preowei development project.
We can also act as a conduit for co-investment with international and local energy companies, leveraging the improved investment climate to derisk entry into frontier deepwater acreage, while aligning with the government’s objectives of value creation, local content and sovereign returns.
The need for socioeconomic development
As Nigeria, and Africa at large, work to monetise hydrocarbon resources in support of growth and development, the continent must not overlook the lessons of the global energy transition—that growth must be just, inclusive and sustainable.
For Africa, the transition cannot simply be a ‘leapfrog to renewables’ while leaving communities and fiscal systems stranded. Rather, hydrocarbons, particularly gas, must serve as transition enablers—fuels that power industrialisation, electrification, job creation and revenue flows that underwrite climate adaptation. In Nigeria, that means ensuring that reforms deliver local content opportunities, community value streams, environmental remediation and energy access. It means that revenue from deepwater output catalyses downstream gas projects, power generation, petrochemicals and industrial clusters—ensuring that hydrocarbons catalyse domestic value creation, not just raw exports. In doing so, Nigeria can make energy sovereignty a platform for shared prosperity.
Reform momentum: Unlocking growth
The confluence of regulatory clarity, fiscal discipline and capital momentum in Nigeria is generating a meaningful shift in perception and opportunity. The government and regulatory leadership deserve credit for moving decisively, overcoming entrenched inertia and signalling seriousness about unlocking Nigeria’s hydrocarbon potential. For upstream stakeholders, this is a moment to act rather than wait. The window to align with deepwater investments under favourable terms is opening, and the risk premium has begun to compress. Meren Energy is strategically poised to mobilise in this environment—bringing technical depth, financial strength and a commitment to value creation for Nigeria.
But success will require steady execution, policy consistency, institutional strengthening and ongoing alignment with local and environmental stakeholders. If sustained, Nigeria’s resurgence could serve as a model across Africa—proving that resource wealth and energy transition can advance together. In a world of accelerating energy transformation, Nigeria’s deep waters may yet become a vital bridge between today’s demand and tomorrow’s ambition
Roger Tucker is CEO of Meren Energy. To read Outlook 2026 in full, click here.
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