Oando calls for financing overhaul to boost Nigeria’s oil production
Nigeria’s ambition to significantly increase crude oil production hinges on more than technical expertise and policy reform; it now requires a serious rethink of how the industry is financed if the country is to hit its output targets, top executives at Oando plc have said. Speaking at the Nigeria International Energy Summit (NIES) 2026 in Abuja, Oando’s Ainojie Alex Irune said traditional funding mechanisms including multilateral lending, trading house credit lines and reserve-based financing may no longer provide the scale or flexibility needed to unlock Nigeria’s full production potential.
Irune explained that while Nigeria has set near-term aspirations of reaching 2 million barrels per day (bpd) and mid-term goals of 3 million bpd, these targets often lack clear pathways to secure the necessary capital required for exploration, field development and production uplifts. Currently, the country’s output hovers around 1.5 million bpd, a figure well below historic highs and far short of government ambitions.
Industry leaders say this capital gap has become one of the most significant barriers to growth in the upstream sector. Despite robust technical capabilities, ageing infrastructure, chronic underinvestment, crude theft and security challenges continue to weigh on output issues that cannot be resolved without commensurate financing. Irune stressed that Nigerians have long been adept at the technical aspects of oil production but that “the question is having the capital to back that execution.”
At the summit, Irune called for a fundamental recalibration of financing strategies. He suggested that Nigeria should explore government-to-government financing arrangements, particularly with eastern economies, and encourage international oil companies (IOCs) to deploy patient capital designs that recognize the long gestation periods and technical complexity of upstream projects.
Executives at the summit also highlighted the importance of policy clarity and regulatory reform in attracting investment. The Petroleum Industry Act (PIA), which introduced fiscal and governance reforms aimed at improving investor confidence, was cited by industry stakeholders as a positive but incomplete step toward de-risking Nigerian upstream oil projects.
They argued that continued regulatory improvements must be matched with innovative approaches to capital mobilisation if Nigeria is to reverse years of production decline and meet its strategic output goals.
The ability of Nigeria’s oil sector to attract and structure appropriate financing will carry significant implications for the country’s economy. Oil revenues remain a primary source of foreign exchange and a cornerstone of fiscal planning, even as the government pursues broader economic diversification. Failure to secure adequate, scalable funding for upstream growth could undermine both production targets and wider economic recovery efforts.
In pushing for new financing frameworks, Oando’s leadership has echoed concerns from other industry voices that the traditional financing playbook reliant on short-tenor loans, reserve-based facilities and sporadic project financing may not support the scale of investment needed.
By promoting patient, structured and collaborative capital solutions, these executives argue that Nigeria can better tap into both domestic and international capital pools, boost investor confidence, and ultimately provide the financial backbone required to meet its oil production ambitions.
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