Ogunsanya Warns Nigeria’s 3mb Oil Production Ambition Faces Major Threat

Nigeria’s efforts to quadruple its daily production of crude oil to three million barrels by 2030 are encountering increasing obstacles, and industry players are cautioning that the goal would become unattainable without prompt government action.

In order to reduce bottlenecks that are impeding project execution and driving up costs, operators are adamantly demanding urgent import duty waivers on vital oil and gas equipment and quicker port clearance.
On the fringes of the Offshore Technology Conference in Houston earlier in May, Wole Ogunsanya, the Chairman of the Petroleum Technology Association of Nigeria (PETAN), amplified the demand.

He claims that the industry is experiencing an emergency that necessitates immediate, focused policy intervention.

He emphasized that increasing production from the current 1.5 million barrels per day would necessitate significant investments in machinery and infrastructure, especially in the gas sector. He also mentioned that tax incentives would enable new funding, expedite the deployment of assets, and bolster Nigeria’s production capacity.

In this interview, Ogunsanya argued that although the pharmaceutical and agricultural industries have profited from these waivers, the oil and gas sector—the hen that lays the golden eggs—must not be left behind.

In addition, he stated that in order to secure its energy future in the face of shifting global economic and geopolitical realities, Africa must immediately strengthen regional cooperation and local capacity building.

Ogunsanya, who is also the CEO of Geoplex Drillteq Limited, emphasized the difficulties Nigerian and African attendees at this year’s conference faced, especially in obtaining US visas, which he claimed had a major impact on participation and exhibition activities.

The expansion of Nigeria’s domestic oil and gas capacity, the significance of regional collaboration, Africa’s aspirations for energy security, and the growing involvement of PETAN member businesses in significant upstream projects were all topics he covered in great detail.

OTC 2026 overview and future projections

OTC 2026 was a major turning point. The number of our members and other Nigerian businesses that could have attended this year’s conference to exhibit, highlight Nigeria’s capabilities, and interact with technology owners, equipment manufacturers, and investors was significantly impacted by the difficulties that come with traveling to the United States.

Due to the difficulties in obtaining American visas, we were severely hampered this year. In fact, you will note that the exhibition rooms were less packed this year compared to prior editions, not just for Nigeria. Wider gaps were between booths, and some areas were even enclosed. I believe that attendance was just about half of what we had last year.

This problem was not exclusive to Nigeria. Participants from several nations were impacted. Unfortunately, this scenario in the US had a significant influence on OTC, which is still the world’s leading oil and gas conference.

We are happy, nonetheless, that PETAN and the Nigerian team managed to make the gathering lively and participatory. In my opinion, the last three days have seen an increase in traffic to the Nigerian area. We also thank Nigerians living in the United States for coming out in big numbers to support us and make sure the event was a success in spite of the challenges we experienced.

The idea

At PETAN, we spend a lot of time strategically examining the industry’s future and attempting to predict changes over the next five to 10 years. After much consideration, the theme for 2026 OTC, “Africa’s Energy Transformation: Scaling Investment, Technology, and Local Capacity for Sustainable Growth,” was chosen.

In terms of economy, energy sourcing, needs, and distribution, the world is actually changing quickly and becoming more regional.

For example, the United States purposefully made significant investments in shale gas production and exploration years ago in the wake of the wars in Iraq and the Middle East. America opened up chances and technologies to utilize shale gas resources after realizing the need for energy security.

Similarly, nations like Canada and Brazil are concentrating on safeguarding their energy future. While China is heavily investing in renewable technology, batteries, and electric vehicles, Europe is actively pursuing renewable energy for sustainability.

The implication is pretty clear for Africa. We also need to get ready for energy security. Africa must realize that its natural resources will play a major role in ensuring its energy security in the future.

Africa may not yet be at the forefront of battery vehicle technology, but we have an abundance of gas and oil resources. Because petrochemicals are still necessary for renewable technologies, oil and gas will continue to be vital for decades. For instance, petrochemical chemicals are used to make the interiors of electric automobiles. Therefore, it is impossible to totally isolate renewable energy from gas and oil.

Africa needs to work together more closely, which is the main takeaway. To ensure energy security on the continent, African nations must strengthen their networking. With approximately 128 billion barrels of oil under African soil and massive gas reserves dispersed over nations like Nigeria, Algeria, Libya, Mozambique, and Senegal, Africa holds more than 10% of the world’s oil and gas reserves.

The difficulty lies in efficiently utilizing these resources.

One of the biggest issues facing Africa is still energy poverty. People who have access to energy can keep medications, process agricultural products, preserve food, and overall live better lives. Life expectancy and energy usage per capita are directly correlated. While Africa continues to struggle with low energy consumption and lower lifespans, countries with higher energy consumption often have longer life expectancies.

Africa must thus not be left behind. Collaboration and knowledge exchange are two methods to prevent that, which is why PETAN supported the creation of the African Local Content Roundtable and related projects.

The African Energy Bank’s July 2026 start is another reason we are happy. Beyond funding, though, the key question is who will carry out the work. Africa cannot keep relying on foreigners to handle every facet of energy development. With more than a billion people living here, it is imperative that we provide work for Africans.

This explains why PETAN is still an advocate for local content creation. Nigeria’s indigenous capacity has been greatly enhanced by its local content laws, particularly the Nigerian Oil and Gas Industry Content Development Act of 2010.

Compared to several other African nations put together, Nigeria’s oil and gas service capability is perhaps five times bigger now. We therefore have an obligation to assist other African countries.

Nigerian engineers have learned a great deal from multinational corporations that have been operating in the country for over 70 years. From that experience, businesses like Renaissance and a number of PETAN member companies were born.

Through cooperation, what took Nigeria 70 years to accomplish may now be repeated much more quickly throughout Africa. African nations can use Nigerian expertise to convey knowledge in 10 to 15 years rather than waiting decades.

Indigenous businesses’ involvement in oil and gas projects

We are all aware that it has been challenging for Nigeria to produce new Final Investment Decisions (FIDs) throughout the years, but in the past two years, a number of significant projects have begun to go forward.

To keep an eye on these prospects and gauge PETAN members’ involvement in significant projects, PETAN formed a Business Strategy Committee.

All domestic businesses are urged to actively bid on open contracts. I can state with confidence that our members are already in the forefront of several important projects, even if the committee is currently gathering thorough statistics.

For example, one of our members is involved in the design of some of the offshore infrastructure in the Bonga project. Several PETAN members are involved in the Ubeta project, and several of the gas well drilling equipment are owned by PETAN member businesses.

This indicates that Nigerian businesses are now equipped to compete on a global scale. We are able to provide services that are on par with those of foreign companies, frequently at a cheaper cost.

Because local operating costs are lower, many of our members actually charge less for services in Nigeria than they would in nations like Angola. Working in Nigeria also enables us to retain more value inside the economy and hire more Nigerians.

Additionally, PETAN members are involved in initiatives related to ExxonMobil, Chevron, and other operators. Our companies are actively competing and winning contracts based on technical competence and merit in deepwater, swamp, and onshore activities.

We have a clear aim. We want indigenous enterprises to secure at least 25 to 30 percent of the overall value of large industry projects, since PETAN makes up a significant share of Nigeria’s local oil and gas capacity.

Crucially, we’re not requesting favors. Through recognized tendering procedures, our members are competing, showcasing their technical prowess and adhering to industry norms.

Import duty waivers are required.

That is a crucial problem. Every government determines which strategic areas need extra care. Governments occasionally even announce emergency measures in areas deemed essential to the country’s progress.

Because the Nigerian government recognizes the wider economic benefits, industries like agriculture and healthcare already benefit from import duty waivers and incentives.

Critical oil and gas equipment should follow the same methodology. A few of our members have petitioned the government to waive import taxes on specialized equipment required for operations.

The reasoning is rather simple. Increased oil and gas activity creates jobs, investments, and higher national revenue, therefore the long-term economic gains outweigh any short-term financial loss to the government from duties.

I am aware that there are continuous conversations in government circles about ways to make doing business easier for the industry, especially with regard to equipment clearance and customs procedures. These are crucial changes that can drastically lower project costs and boost indigenous businesses’ operational effectiveness.

Mrs. Olu Verheijen, the President’s Special Advisor on Energy for Oil and Gas, has been keeping an eye on the industry, and a number of projects, particularly in the gas sector, are now underway. Import tariff exemptions are possible, especially in light of the industry’s urgency.

Currently, Nigeria produces over 1.5 million barrels every day. Production is around 1.4 million barrels per day if condensates are eliminated. The government’s goal is to attain three million barrels per day by 2030, and it is anticipated that we will reach two million barrels per day by the following year.

It is necessary to handle this as an emergency. Only a small portion of the manufacturing value that will ultimately result from the equipment we are importing is represented by it.

For example, if I buy equipment that costs $1 million and I have to pay 20 percent import duty, that comes to $200,000. Alternatively, I may use that same sum to purchase more equipment from the Original Equipment Manufacturer (OEM). I could offer the OEM $1 million, request three pieces of equipment, and then pay the remaining amount at a later time.

The country’s equipment capacity would increase as a result of such duty alleviation.

In order to add value to production, we will work with the Office of the Special Adviser and the pertinent government authorities to investigate the possibilities of securing duty exemption for genuine oil and gas equipment being imported.

There should be a structure that permits such imports to receive concessions if an operator certifies that certain equipment is required for projects like Bonga North or other developments and NNPC Limited agrees that the equipment would assist further oil or gas production.

For instance, the government should be able to substantiate a company’s claim that the equipment will contribute to the production of an extra 100 million standard cubic feet of gas.

In addition to duty alleviation, the ports should have a unique clearance procedure to prevent needless delivery delays.

However, based on PETAN members’ experiences, there aren’t as many delays as there once were. I can state that equipment clearance has typically been finished in a week or two.

From PETAN’s perspective, I think the Nigeria Customs Service has been quite receptive and understands the significance of these initiatives.

However, tax relief is still the biggest concern for me. This should be handled by the government in the same manner that it supports other critical industries where the importation of assets and equipment is urgent and important to the nation.