Nigeria, 4 Others Lead As Africa Upstream Investment Drops to $37bn—IEA

The International Energy Agency (IEA) said that Africa’s upstream oil and gas investment fell to $37 billion in 2025 from $68 billion in 2016, as five countries—Algeria, Angola, Egypt, Nigeria and Libya— continue to account for most of the continent’s investment and production.

The agency, in its 2026 World Energy Investment report, said investment remained heavily concentrated in those five major producers, even though spending in those markets had declined.

It said the five countries “account for 70 per cent of investment and 80 per cent of production,” and added that total investment across them had halved from $50 billion in 2016 to $25 billion in 2025, with Libya showing an increase that reflected shifts in investment competitiveness.

The IEA said exploration capital expenditure reached almost $6.5 billion in 2025, reflecting continued activity around recent discoveries. It said exploration remained inherently risky, noting that the global commercial success rate stood at about 27 per cent, and that national oil companies (NOCs) were taking on a greater role in exploration because of that risk.

The agency said national oil companies accounted for about one-quarter of total upstream capital expenditure, while private and international oil companies remained the primary drivers of investment. It warned that constrained government budgets in some producer countries could limit NOCs’ ability to finance upstream work, and said partnerships and alternative financing arrangements were becoming increasingly important, citing Mozambique and Senegal as examples.

On Nigeria, the IEA said the country was among the top five producers dominating upstream activity in Africa.

It noted that Nigeria had recently highlighted reforms aimed at improving investment in the upstream sector, and quoted the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as saying those reforms had unlocked more than $10 billion in upstream investment.

The NUPRC said the reforms were anchored on the Petroleum Industry Act (PIA) of 2021, which it said was designed to improve transparency, attract investment, strengthen governance and increase government revenue.

The regulator said related Executive Orders had been introduced to streamline approvals and improve fiscal terms, and added that the reforms had supported projects including Bonga North, Ubeta and the HI development through improved fiscal clarity, streamlined licensing and faster approval processes.

The IEA said the decline in overall African upstream investment highlighted changes in investment competitiveness across the continent’s established oil and gas producers, and warned that the sector continued to face challenges in attracting and financing new projects.

The agency said private and international oil companies remained the main drivers of upstream spending, underlining the sector’s reliance on external capital, technology and project execution capacity.

Recall that the NUPRC announced 31 companies that won 37 oil and gas blocks in Nigeria’s 2025 Licensing Round following a competitive bidding process.

The commission has also said that Nigeria’s crude oil production rose by about 40.5 per cent to 1.84 million barrels per day in April 2026, up from 1.459 million bpd in January 2026, after which production dipped to 1.31 million bpd in February.