5.250
%
Positive
103
mm boe
51
%
The liberalisation of NNPC's financing and the Petroleum Industry Act are paving the way for growth, and crude output has improved as theft falls. The sale of onshore assets by the IOCs to local firms and the Dangote refinery are reshaping the sector, although insecurity, FX constraints and the 2027 election remain risks. Outlook maintained because reforms continue to improve the operating environment. Outlook: Positive. Risk premia unchanged at 5.25%.
October 7, 2026
Africa - West
mm bbl
bcf
Western Africa, bordering the Gulf of Guinea, between Benin and Cameroon.
Multiple (PSC/Concession)
The Petroleum Industry Act (PIA) 2021 overhauled the regime and allows existing licences to convert to PIA terms. Onshore and shallow-water assets are largely NNPC joint ventures under royalty/tax terms, while deep water is dominated by PSCs with NNPC. Under the PIA, Hydrocarbon Tax (30% for onshore and shallow-water leases, 15% for marginal fields and prospecting licences, nil for deep water) applies alongside 30% Companies Income Tax, with royalties from 7.5% (deep water and frontier) to 15% (onshore) plus price-based royalty. Presidential executive orders in 2024 added tax credits and incentives for new gas and deepwater investment.
President Bola Tinubu's reforms, including fuel-subsidy removal and exchange-rate unification, have improved the macroeconomic outlook, although inflation and insecurity remain severe ahead of the February 2027 election. The US designated Nigeria a Country of Particular Concern over religious violence in 2025. US and UK guidance cite corruption, FX constraints and regulatory uncertainty, with the Petroleum Industry Act a key reform. The EIA notes that crude output has improved to about 1.5–1.7 million b/d as theft falls. IOCs (Shell, ExxonMobil, Eni) have sold onshore assets to local firms, and the 650,000 b/d Dangote refinery has reshaped domestic fuel supply.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
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