Nigeria Oil And Gas Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Upstream activities captured 75.2% of Nigeria's oil and gas market share in 2024, as high-impact drilling and workovers ramped up after fiscal reforms. This segment is projected to clock the fastest 6.1% CAGR, adding substantial barrels that support the growth of the Nigerian oil and gas market size. January 2025 production of 1.53 million barrels per day marked the first on-quota performance in years, aided by digital well-surveillance tools that cut unplanned downtime by 15%. Midstream gas processing rose in tandem with ANOH and other capacity additions, creating a clearer pathway for flare capture and power-sector delivery. Downstream moves center on Dangote's refinery, which absorbs local crude and triggers fresh tank-farm and jetty construction, boosting EPC revenues.

Upstream momentum reflects a wave of indigenous takeovers of IOC divested assets, most notably Seplat's purchase of ExxonMobil's onshore portfolio and Oando's acquisition of Nigerian Agip blocks. These transfers often include sizeable abandoned-well inventories, prompting operators to budget decommissioning funds as mandated under PIA abandonment rules. Digital asset-loss controls, such as NUPRC's Advance Cargo Declaration system, help stem crude theft by enabling real-time verification of shipments. Meanwhile, the Cost Efficiency Incentive program offers tax credits to operators who deliver barrel-lifting costs below USD 20, thereby stimulating the broader adoption of predictive maintenance and downhole analytics.

Offshore fields accounted for 66.9% of Nigeria's oil and gas market revenues in 2024 and are forecast to grow at a healthy 4.9% CAGR to 2030, underpinning further gains in the overall Nigerian oil and gas market size. Deepwater blocks avoid onshore militancy, drawing sustained IOC capital for high-volume projects. Regulatory approval for the country's first floating LNG (FLNG) unit in OML 104 underscores offshore gas monetization potential and aligns with global LNG supply tightness. Subsea compression and high-integrity pipeline designs reduce maintenance interventions, thereby cutting life-of-field costs despite the complexity of deepwater operations.

Onshore operations remain cost-competitive in terms of capital expenditure, yet they frequently suffer from downtime due to vandalism and spills. Indigenous firms now dominate these blocks after securing asset divestments; they hedge security risk through community-based surveillance contracts and bunker-proofed pipeline segments. Shallow-water assets act as a bridge between the two extremes, balancing security exposure and cost. PIA royalty-rebate schemes for frontier basin exploration incentivize new seismic shoots in under-explored offshore zones such as the Dahomey Basin, potentially broadening Nigeria's production geography over the long term.

Construction accounted for 55.5% of total service spending in 2024, driven by megaprojects such as LNG Train 7 and the Ajaokuta-Kaduna-Kano gas pipeline, thereby solidifying the Nigeria oil and gas market's size on the services side. EPC contractors meet a 55% local-content threshold on engineering person-hours, spurring the flow stationsgrowth of indigenous fabrication yards in Port Harcourt and Lagos. The downstream build-out—centered on Dangote, BUA, and a wave of modular refineries—creates follow-on demand for storage terminals, jetty upgrades, and product pipelines.

Decommissioning, however, is the fastest-growing service niche, with a 7.3% CAGR, as legacy wellheads and flow stations reach the end of their life. The PIA mandates annual escrow contributions and full abandonment plans, forcing acquirers of onshore and shallow-water assets to front-load retirement liabilities. Chevron's 2025 plug-and-abandon campaign signals a step-change in spending on well plugbacks and site remediation. Digital-twin models aid in cost estimation and scheduling, while ROV-assisted cutting tools reduce offshore campaign duration. Maintenance and turnaround activities hold steady because operators seek incremental recoveries from brownfields before irreversible shutdown.

The Niger Delta remains the production heartland, accounting for more than 90% of the nation's output through a blend of mature onshore clusters and prolific offshore blocks. Rivers State hosts Nigeria LNG’s six-train complex and the upcoming Train 7, making it the epicenter of LNG revenue and skilled-labor demand. Akwa Ibom is poised for heightened offshore attention once the UTM FLNG unit targets the Yoho field, potentially adding 2.8 million tonnes per year of export capacity. Meanwhile, Bayelsa and Cross River balance pipeline-vandalism risks with Host Community Trust funding, which channels 3% of operator spending into local infrastructure.

Lagos gains unprecedented downstream significance with the Dangote refinery cluster, positioning the state as a West African fuel hub and trimming inland freight costs. Its deepwater port and free-zone incentives attract tank-farm investors targeting regional re-exports. Northern Nigeria, historically absent from the hydrocarbon map, is set to receive its first gas flows via the Ajaokuta-Kaduna-Kano pipeline, catalyzing the development of industrial parks in Kano and Kaduna.

Federal oversight intensifies nationwide under NUPRC’s satellite-enabled metering audits, enhancing transparency across states. However, security interventions remain Delta-centric, reflecting the region’s outsized share of both production and risk exposure. Collectively, these geographic shifts reinforce Nigeria’s strategic intent to diversify its value-added centers while safeguarding its crude oil cash cows.