Evaluating Nigeria’s Changing Oil and Gas Environment

On May 29, President Bola Tinubu will mark the halfway point into his tenure. Midway into his first term, Nigeria’s oil and gas sector, a long-standing cornerstone of the nation’s economy, stands at a critical juncture. Since assuming office, the Tinubu administration has embarked on a series of policy reforms and strategic initiatives aimed at revitalising the industry, enhancing revenue generation, and attracting foreign investment. But in the midst of some crowning moments, there still remain mountains of challenges. Emmanuel Addeh examines the strides and struggles in the last two years.

When President Bola Tinubu campaigned for the presidency, he pledged bold reforms to transform Nigeria’s oil and gas sector, from ending fuel subsidies and boosting local refining capacity to restructuring the Nigerian National Petroleum Company (NNPC) for transparency and efficiency.

Tinubu outlined an ambitious agenda to overhaul the sector. He promised to phase out fuel subsidies, incentivise investment in domestic refining, unlock the full potential of gas as a transition fuel, and ensure the national oil company operated with profitability under the new Petroleum Industry Act (PIA).

Two years into his administration, the sector remains both a pillar of economic hope and a flashpoint for public scrutiny, remaining the lifeblood of the nation’s economy and sitting at the centre of both high expectations and persistent structural challenges.

In the wake of those promises, his administration swiftly took major steps, most notably, the controversial but decisive removal of fuel subsidies in his first week in office. The move was hailed by economists as long overdue but met with public backlash due to the immediate rise in transportation and living costs. Meanwhile, efforts to boost local refining by the rehabilitation of state-owned refineries have made headlines, but questions remain.

Halfway through Tinubu’s tenure, questions persist: Has the administration delivered on its reformist outlook? Are investments increasing? Is the NNPC transforming into a truly national oil company? And perhaps most crucially, are Nigerians seeing the promised benefits of a restructured energy economy?
The answers to these questions may not be as straightforward as many would want, whether in terms of policy actions, implementation outcomes, stakeholder reactions, and the broader impact on national revenue, energy security, and the daily lives of Nigerians.

But what cannot be denied is that there has been a systematic and methodical push by the Tinubu administration to overhaul the sector, reduce bottlenecks to growth, put round pegs in round holes, depoliticise critical sector decisions and make the general oil business environment more attractive for both local and foreign investment.

Broadly speaking, Tinubu’s targets for the immediate overseers of the oil and gas sector were to increase crude oil production, accelerate completion of ongoing critical gas projects, increase local production of petroleum products, including petrol, diesel, naphtha and others by ensuring availability of crude for domestic refining.

He also directed them to facilitate an increase in gas production, especially for power, industrial and domestic uses as well as initiate and implement citizens and stakeholder engagement sessions to communicate government activities which will serve as a feedback mechanism.

Source: thisdaylive.com

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