Nigeria Eyes Broader Oil Boom As Africa’s Energy Peaks

Africa is entering a new phase in its energy development journey, one that industry experts say will be defined less by fresh hydrocarbon discoveries and more by the continent’s ability to build infrastructure, expand liquefied natural gas (LNG) capacity, commercialise existing reserves and create stable investment environments.

Analysts at the State of African Energy 2026 Outlook webinar, hosted by the African Energy Chamber (AEC) and S&P Global, said deepwater projects, LNG expansion and gas-to-power investments are becoming the major indicators of competitiveness as investors increasingly prioritise execution capacity, regulatory certainty and project delivery.

According to S&P Global, Africa’s upstream sector is expected to stabilise, with production projected to reach 11.4 million barrels of oil equivalent per day (boed) in 2026, while upstream capital expenditure may hit approximately $41 billion. Offshore deepwater projects are expected to remain the dominant source of long-term supply growth amid declining output from mature onshore assets.

Nigeria appears positioned to benefit significantly from this shift. Improved fiscal reforms, regulatory clarity and enhanced security measures in oil-producing areas have strengthened investor confidence and revived interest in the country’s energy sector.

Special Adviser to President Bola Tinubu on Energy, Olu Verheijen, said Nigeria has laid the foundation for sustained growth after years of underperformance.

“The work continues, but the foundation has been laid for sustained growth, and the capital markets have delivered their verdict: Nigeria is once again the place to invest in African energy,” she said.

Between 2014 and 2023, Nigeria secured only about four per cent of Africa’s upstream Final Investment Decisions (FIDs), despite possessing the continent’s largest proven oil reserves and vast natural gas resources. However, that trend has shifted sharply.

Within two years, Nigeria attracted renewed investment interest, with over $10 billion in Final Investment Decisions concentrated around deep offshore and integrated gas projects. The momentum is expected to continue through projects such as Bonga South West, Zaba Zaba, Owowo and several natural gas developments, potentially exceeding $50 billion in future upstream investments.

The renewed capital inflow has translated into increased production. Between 2023 and 2026, Nigeria reportedly added about 400,000 barrels per day to output, reaching approximately 1.6 million barrels daily in 2025.

Energy and governance expert Sola Adebawo said Africa is increasingly being repositioned from a development-focused narrative to a strategic economic actor shaped by energy security, industrial competition and geopolitical realignment.

He noted that Europe’s growing engagement with Africa is driven largely by the need to diversify energy sources, secure critical mineral supply chains and reduce dependence on competing geopolitical blocs.

Africa holds approximately 18 trillion cubic metres of proven natural gas reserves, much of which remains undeveloped. Countries including Nigeria, Mozambique, Senegal, Mauritania and Equatorial Guinea are becoming increasingly important to Europe’s long-term energy planning.

However, experts argue that the major challenge is no longer resource availability but the capacity to establish integrated value chains supported by infrastructure, financing and policy stability.

S&P Global’s Head of EMEA Gas, LNG and Low Carbon Gases Consulting, Simon Wood, said financing, regulatory certainty and infrastructure coordination remain central to unlocking Africa’s energy potential.