Nigeria’s oil and gas sector is gaining new momentum, thanks to fresh investments and ongoing reforms aimed at making the industry more sustainable.
According to Gbenga Komolafe, head of the country’s upstream regulatory body, the number of active oil rigs in Nigeria has risen from eight in 2021 to 46 as of July 2025.
He explained that rig count is a key measure of industry activity and investment, as it reflects the number of drilling rigs currently engaged in exploration and production.
But beyond the numbers, what does this surge really mean for a sector where the investment climate is finally improving and heading in a promising direction?
Strong upstream rebound
Nigeria’s rig count has seen a consistent upward trend since the COVID-19 oil crash in 2020.
According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the country’s rig count doubled from 16 in 2021 to 32 in 2024.
As of July 2025, the number has increased to 46, representing a 30% jump in less than a year.
This rise indicates renewed exploration and production across both onshore and offshore fields.
Oil firms typically deploy more rigs when they expect favorable returns—driven by improved prices, supportive policies, or both.
The increase also suggests that previously stalled or delayed projects are now being reactivated.
Boost to domestic supply
The resurgence in rig activity supports new well drilling, which ultimately expands domestic oil and gas supply.
This is vital for powering refineries, especially the Dangote Refinery, and reducing Nigeria’s dependence on foreign crude.
In 2024, Nigeria’s production climbed to 1.55 million barrels per day (bpd)—its highest in four years.
The country is currently producing 1.7 million barrels daily, including condensates.
This production increase can help reduce crude imports, which surged in Q1 2025 to $2.98 billion, up from $2.68 billion in Q4 2024.
The Dangote Refinery, which has been relying on U.S. WTI imports, has stated plans to fully switch to Nigerian crude by the end of the year as local supply improves.
Renewed investor confidence
The jump in rig count is also a direct result of Nigeria’s recent policy reforms.
The Petroleum Industry Act (PIA) of 2021, along with executive orders on fiscal incentives, local content, and project timelines issued in 2024, have created a more attractive investment climate.
In 2024, Nigeria accounted for three of four Final Investment Decisions (FIDs) in Africa’s oil sector, attracting over $5 billion in new capital.
These policies have also encouraged local firms to acquire divested assets from international oil companies.
Increased drilling, output, and jobs
Rising rig numbers often translate to more wells, more production, and more jobs.
Nigeria is working toward a 2 million bpd target this year, as well as pushing for the same volume as OPEC.
Petralon, for instance, is set to resume drilling at the Dawes Island field to boost local output.
This surge also strengthens Nigeria’s argument for a higher OPEC quota and supports long-term energy security by encouraging the discovery of new reserves.
The bigger picture
This uptick in rig count is more than symbolic; it reflects a sector regaining momentum.
It supports thousands of jobs and indicates capital is flowing again.
But to sustain this progress, Nigeria must tackle persistent challenges such as high production costs, which continue to limit revenue potential for operators and the broader economy.
Overall, a robust rig count means Nigeria’s oil and gas sector is indeed witnessing a revival.
