Ageing assets, talent deficit, funding gaps threaten Nigeria’s

Nigeria’s ambition to raise crude oil production to three million barrels per day by 2030 could remain elusive unless the country urgently addresses ageing infrastructure, inadequate investment, limited technical capacity, financing constraints and lingering supply chain weaknesses, leading indigenous oil executives have warned.

The industry leaders, who spoke during a strategic panel session titled “Production Optimisation Strategies-Maximising Investments in the New Energy Landscape” at the 2026 Nigeria Oil and Gas (NOG) Energy Week which ended in Abuja last week, said while recent reforms have restored investor confidence, significant structural challenges must still be overcome before the production target becomes achievable.

Speaking on the panel, Mr. Ainojie ‘Alex’ Irune, Managing Director of Oando Energy Resources, described the three million barrels per day target as deliberately ambitious but technically achievable if Nigeria protects existing production while accelerating new developments.

According to him, Nigeria is currently producing only about 70 per cent of its technical production capacity, indicating substantial untapped potential.

“We have established that the capacity to produce more exists. The real question is whether, as a country, we have the discipline and urgency to achieve that goal,” Irune said.

He noted that many of the long-standing obstacles that had constrained production, including insecurity, delayed cash call payments and regulatory uncertainty, had begun to ease following the implementation of the Petroleum Industry Act and recent Executive Orders.

However, he stressed that sustaining the reforms would be critical.

“The first responsibility is to protect the production base. Once we stop the decline in existing assets, we can begin to unlock additional production and future projects,” he said.

Despite attracting a growing share of Africa’s upstream investments, Irune warned that Nigeria’s greatest challenge may no longer be capital alone but the capacity to execute projects.

He disclosed that Nigeria’s share of Africa’s upstream investment had risen from about four per cent to nearly 40 per cent over the last two years, yet the country lacks sufficient fabrication yards, skilled geoscientists and experienced technical personnel to support the scale of development required.

“If Nigeria attracts the $20 billion annual investment needed to reach three million barrels per day, we simply do not have enough geoscientists to evaluate the reservoirs, nor enough fabrication capacity to execute the projects. The supply chain challenge goes beyond equipment; it is also about people,” he said.

Irune added that years of limited investments had triggered a significant loss of skilled professionals, making human capital development an urgent priority for indigenous operators.

Chairman and Chief Executive Officer of Shoreline Group, Mr. Kola Karim, identified ageing production facilities, inadequate financing and weak evacuation infrastructure as major constraints limiting output growth.

Using Oil Mining Lease (OML) 30 as an example, Karim said unlocking higher production would require aggressive drilling campaigns alongside large-scale rehabilitation of obsolete facilities inherited from international oil companies.

“Some of the compressors on these assets were installed in 1979. They are older than many of us. Without renewing these facilities, increasing production becomes extremely difficult,” he said.

He added that increasing crude production would be meaningless without reliable pipelines to evacuate crude from producing fields.

“There is no point drilling more wells if you cannot evacuate the oil. Pipeline integrity, infrastructure renewal and reliable evacuation systems are fundamental to achieving three million barrels per day,” Karim said.

Beyond infrastructure, Karim said financing remains a major hurdle, noting that Nigeria’s banking sector alone cannot fund the massive investments required to rehabilitate mature assets.

He called for stronger collaboration among indigenous operators, drawing parallels with the successful formation of Renaissance Africa Energy Company, which acquired Shell’s onshore assets through a consortium of Nigerian companies.

“We need more collaboration among indigenous companies. Renaissance has shown what is possible when Nigerian companies come together to execute large transactions. Similar partnerships will be required if we are serious about growing production,” he said.

Karim also stressed the importance of sustaining improved community engagement and security, noting that stable operating environments had contributed to recent improvements in production across the Niger Delta.

For the Chief Executive Officer of ND Western, Mr. Lanre Kalejaiye, the biggest challenge lies in maximising production from mature fields while simultaneously developing large volumes of undeveloped reserves.

He revealed that only about 13 per cent of OML 34 had been developed despite holding significant oil and gas resources.

According to him, the company plans to drill 20 new wells over the next three years as part of efforts to unlock additional reserves.

However, he said production optimisation extends beyond drilling.

“It is a holistic approach—from understanding the reservoirs to deploying advanced drilling technologies, improving well completions, artificial lift systems and ensuring efficient export infrastructure,” Kalejaiye said.

He noted that technology such as horizontal drilling and multi-zone completions could significantly improve production rates and recovery factors from existing reservoirs.

On gas development, Kalejaiye identified pricing, payment defaults and regulatory uncertainties as major obstacles discouraging investment.

He argued that achieving Nigeria’s broader energy objectives would require commercially viable gas pricing and prompt settlement of debts owed to gas producers.

“We have installed processing capacity, the demand exists, but investment will only continue if pricing becomes cost-reflective and payment mechanisms improve,” he said.

Managing Director and Chief Executive Officer of Waltersmith Petroman Oil Limited, Mr. Oladapo Filani, advocated greater integration across the oil and gas value chain, arguing that maximising value from every hydrocarbon molecule would strengthen project economics and support future investments.

Filani said Waltersmith’s investment strategy prioritises cash-generating assets while expanding refining capacity and gas utilisation.

He disclosed that the company’s modular refinery had doubled capacity to 10,000 barrels per day and was already exporting refined petroleum products to regional markets.

According to him, integrated operations create stronger cash flows that can be reinvested into upstream exploration and production.

He also urged prospective investors participating in marginal field development to focus on quality assets, leverage existing infrastructure and pursue phased development strategies that reduce project risks and improve access to financing.

Collectively, the industry experts agreed that Nigeria possesses sufficient hydrocarbon resources to achieve the three million barrels per day target, but warned that success would depend on sustained reforms, increased investment, modern infrastructure, stronger collaboration among indigenous companies and deliberate investment in human capital.

Rather than viewing the target as merely a production milestone, they said it should serve as a catalyst for building globally competitive Nigerian energy companies capable of driving long-term industry growth.