Nigeria’s deepwater oil manufacturing has plummeted to its lowest degree in 5 years, underlining the rising structural and funding challenges going through Africa’s largest oil producer.
Newest business knowledge present the nation’s deepwater output stood at 428,385 barrels per day (bpd) as of April 2025, a pointy decline from 629,558 bpd recorded in 2020, representing a 32 % drop over the interval.
This decline, occurring in what has historically been Nigeria’s most secure oil-producing zone, is triggering alarm amongst stakeholders and highlighting the pressing want for implementation of reforms to revive investor confidence and operational effectivity within the sector.
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A sector in decline
The deepwater phase, developed largely by worldwide oil firms (IOCs) by means of advanced offshore tasks, has lengthy supplied a buffer in opposition to the extra unstable onshore and shallow offshore areas stricken by insecurity and sabotage.
However the current figures reveal that this once-dependable zone is now faltering.
Manufacturing figures from key operators – Shell, ExxonMobil, TotalEnergies, Chevron, and Eni – present an nearly across-the-board discount in output, with getting older infrastructure and lack of latest investments steadily cited as core causes for the hunch.
“No new funding has been made because the Egina venture,” stated the CEO of a Nigerian upstream firm, who spoke on the situation of anonymity. “Delays in Ultimate Funding Selections (FIDs) for main tasks like Bonga South West and ExxonMobil’s deepwater fields have damage manufacturing and overseas funding inflows.”
Authorized, regulatory hurdles
Trade analysts argue that the drop is just not solely the results of getting older oil rigs and subject maturity, but in addition of regulatory inertia and gradual implementation of reforms.
Ola Alokolaro, managing accomplice at Advocaat Regulation Apply, defined that “reforms are both under-implemented or too gradual to replicate in actual manufacturing positive factors.”
He pointed to maturing deepwater fields as a pure issue behind the decline however harassed that delayed FIDs are widening the availability hole.
“We should expedite amendments to our legal guidelines, resolve uncertainties surrounding Manufacturing Sharing Contracts (PSCs), and streamline regulatory approvals,” Alokolaro emphasised.
Certainly, one of many recurring complaints amongst oil majors is Nigeria’s sluggish bureaucratic processes that delay venture growth timelines and inflate prices, making different jurisdictions like Guyana, Brazil, and Angola extra enticing.
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Reforms: Promising on paper, awaiting motion
There may be some optimism that current government orders signed by the Nigerian authorities, which deal with price discount, tax incentives, and shortening contracting cycles, could possibly be a turning level.
Nevertheless, NJ Ayuk, government chairman of the Africa Vitality Chamber, supplied a cautious perspective.
“These reforms are encouraging in principle,” Ayuk stated. “However in oil and fuel, particularly in Nigeria, success is measured by execution. Except these reforms are applied with urgency and consistency, the advantages will stay hypothetical.”
Ayuk famous that almost all of Nigeria’s legacy deepwater fields are in decline, and solely long-delayed mega tasks can considerably carry output. “We have to get shifting on venture sanctions to stop a continued slide in manufacturing.”
Subject-specific evaluation: Winners, losers
A granular have a look at field-level knowledge from 2020 to April 2025 paints a extra vivid image of the disaster:
Bonga (Shell)
Considered one of Nigeria’s flagship deepwater belongings, Bonga’s output, has seen sharp fluctuations, from 117,506 bpd in 2020 to a low of three,029 bpd in 2022, earlier than bouncing again to 124,946 bpd in 2023.
Whereas averaging round 127,600 bpd in 2025, Bonga has but to interrupt by means of its 2020 ceiling, indicating challenges in sustaining peak manufacturing.
Erha (ExxonMobil)
Erha has posted a worrying trajectory. From 64,419 bpd in 2020, manufacturing dipped to 60,268 bpd in 2022, peaked at 69,635 bpd in 2024, and declined once more to 61,790 bpd by April 2025. The inconsistencies could replicate operational challenges and pure subject depletion.
Usan (ExxonMobil)
Usan’s manufacturing has been notably erratic. From 37,192 bpd in 2020, output rose to 44,157 bpd in 2022 however fell sharply to 30,236 bpd in 2024. By March 2025, it had dipped additional to twenty-eight,904 bpd, underscoring the dearth of dependable restoration mechanisms or new wells.
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Egina (TotalEnergies)
As soon as seen because the jewel in Nigeria’s deepwater crown, Egina’s output has been in freefall, from 154,027 bpd in 2020 to only 63,916 bpd by April 2025. The 58.5 % plunge highlights the results of not replenishing reserves or conducting main reworks.
Agbami (Chevron)
Agbami has not been spared both. From 143,307 bpd in 2020, manufacturing dwindled to 95,782 bpd in 2024. Though 2025 knowledge present a slight restoration, the sector stays removed from its historic highs.
Akpo (TotalEnergies)
Akpo’s fall has been steep, from 97,279 bpd in 2020 to 36,896 bpd in 2024. A marginal enchancment has been noticed in early 2025, however long-term sustainability seems questionable.
Abo (Eni)
In distinction to the overall decline, Abo has demonstrated relative resilience. From 1,582 bpd in 2020, it rose steadily to take care of over 12,000 bpd in early 2025. Whereas its scale is small, the consistency affords a uncommon shiny spot.
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The price of inaction
The plummeting figures are greater than a statistical anomaly; they pose actual threats to Nigeria’s financial stability. Deepwater oil revenues are essential for price range planning, overseas trade earnings and vitality sector employment.
If Nigeria can’t reverse the pattern, it dangers shedding its place amongst prime African producers and lacking out on billions in potential revenues.
As Brazil and Guyana proceed to ramp up manufacturing and entice capital, Nigeria’s deepwater sector is at a crossroads. Both it accelerates the implementation of business reforms, addresses infrastructure gaps, and affords clear funding incentives, or it continues its gradual slide into irrelevance.
Within the phrases of a senior oil government, “The geology is just not the issue; it’s governance. If Nigeria will get the principles proper, the rigs will return.”
For now, nonetheless, the information tells a narrative of decline, one formed by getting older rigs, regulatory inertia, and a race in opposition to time.
