Indigenous firms break oil majors’ grip in historic shift

Indigenous oil production now exceeds 50 percent of Nigeria’s output, ending decades of dominance by international oil majors

Indigenous oil companies in Nigeria have overtaken international majors in national oil and gas production for the first time in more than seven decades, marking a decisive and historic shift in the country’s petroleum industry, industry leaders said in Abuja in early February 2026.

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Adegbite Falade, Chairman of the Independent Petroleum Producers Group, disclosed at the Nigerian International Energy Summit that local producers now account for more than 50 percent of Nigeria’s total oil and gas output, ending a dominance by foreign operators that dates back to the start of commercial production in 1956.

Falade described the development as a watershed moment that reflects a fundamental restructuring of control within the sector, driven by years of asset divestments, regulatory reform and growing operational capacity among Nigerian-owned firms.

The shift follows the accelerated exit of international oil companies from onshore and shallow-water assets, with multinationals such as Shell, ExxonMobil, TotalEnergies and Eni selling mature fields to indigenous operators.

Those assets, long affected by security challenges and declining investment, have since been revived through targeted capital deployment and localised management.

Industry data indicate that these transitions have already added roughly 200,000 barrels per day to national output, helping Nigeria recover production levels that had slumped in recent years.

Several indigenous firms have emerged as central players in the transformation. Renaissance Energy, which acquired Shell’s onshore subsidiary in March 2025, has reported sharp output increases.

Seplat Energy strengthened its position after purchasing ExxonMobil’s onshore and shallow-water licences for $1.3 billion, while Oando has committed to heavy upstream investment following its acquisition of Eni assets.

Other local operators, including Heirs Energies, Aradel Holdings and Waltersmith, have also revitalised key oil mining leases, reinforcing confidence in the capacity of indigenous firms to manage complex assets and deliver results under challenging conditions.

Government policy has played a critical role in enabling the transition. Reforms introduced under the Petroleum Industry Act, alongside security initiatives and production recovery programmes, have helped stabilise output and improve investor confidence.

Nigeria’s crude production averaged between 1.47 and 1.6 million barrels per day in 2025, the highest level recorded in five years.

The expansion of indigenous oil production has extended into the gas sector, where local firms are increasingly leading output growth, supporting national objectives around gas-based industrialisation and emissions reduction.

Officials say the shift carries far-reaching economic implications, including higher domestic value retention, job creation and stronger technical capacity within Nigeria.

However, analysts caution that sustaining momentum will depend on continued security improvements, access to long-term financing, environmental discipline and regulatory consistency.

After seventy years of foreign dominance, Nigeria’s oil industry has entered a new chapter defined by local leadership.

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The change signals not only a redistribution of production volumes but a profound realignment of ownership, confidence and control in one of Africa’s most strategic sectors.

Mariam Balogun