ExxonMobil Returns to Nigeria With $1 Billion Deepwater Investment After Nearly a Decade, Targets 40,000 Barrels Daily

ExxonMobil Returns to Nigeria With $1 Billion Deepwater Investment After Nearly a Decade, Targets 40,000 Barrels Daily

ExxonMobil has officially returned to large-scale drilling in Nigeria with a $1 billion investment, ending nearly a decade without new drilling operations in Africa's largest oil-producing nation.

The American energy giant announced the investment during NOG Energy Week in Abuja, confirming that work has commenced on the Usan Infill Project in Oil Mining Lease (OML) 138. The project is expected to deliver its first oil within the next 18 months and increase production by approximately 40,000 barrels of crude oil per day.

The development marks ExxonMobil's first drilling campaign in Nigeria since 2016, signaling renewed confidence in the country's offshore oil sector after years of declining investment.

ExxonMobil Bets Big on Nigeria's Deepwater Oil Sector

The project is being executed through Esso Exploration and Production Nigeria (Offshore East) Limited, ExxonMobil's Nigerian affiliate, in partnership with NNPC Ltd., Chevron, TotalEnergies, and Nexen, a subsidiary of China's CNOOC.

Unlike a completely new oilfield, the Usan Infill Project focuses on unlocking additional reserves around the existing Usan Floating Production, Storage and Offloading (FPSO) facility. This approach allows production to ramp up faster while significantly reducing development costs.

According to ExxonMobil, advanced seismic studies completed in 2024 identified new drilling opportunities within the Usan field, paving the way for the massive investment.

Major Boost for Nigeria's Oil Production

Nigeria has struggled in recent years with declining crude oil production due to:

- Oil theft

- Pipeline vandalism

- Aging infrastructure

- Regulatory uncertainty

- Delayed investments

Government officials believe ExxonMobil's return could become a turning point for the country's energy sector.

Speaking at the project launch, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Chief Executive Gbenga Komolafe described the investment as a significant milestone for Nigeria's offshore industry.

He noted that spending $1 billion to unlock an additional 40,000 barrels of oil per day demonstrates the enormous potential still available in Nigeria's deepwater assets.

Officials also credited reforms introduced under the Petroleum Industry Act (PIA) for helping restore investor confidence.

ExxonMobil Reaffirms Long-Term Commitment to Nigeria

ExxonMobil's Chairman and Managing Director in Nigeria, Jagir Baxi, said the company remains committed to expanding its deepwater operations despite divesting from several shallow-water assets.

According to him, the Usan Infill Project reflects ExxonMobil's long-term strategy of deploying advanced technology to safely increase production while creating value for investors and supporting Nigeria's economic growth.

The company also acknowledged the support of the NUPRC, NNPC Ltd., the Nigerian Content Development and Monitoring Board (NCDMB), and its joint venture partners for making the project possible.

Why This Investment Matters

The announcement comes as Nigeria intensifies efforts to attract fresh upstream investments and restore crude production to higher levels.

Industry experts believe successful execution of the Usan Infill Project could:

- Increase Nigeria's daily oil output by 40,000 barrels.

- Generate billions of dollars in additional revenue.

- Strengthen investor confidence in Nigeria's energy sector.

- Create employment opportunities and boost local content.

- Encourage more international oil companies to invest in offshore exploration.

With several new petroleum licences recently awarded and fresh reforms taking effect, Nigeria hopes the ExxonMobil investment will signal the beginning of a new era for its oil and gas industry.

Final Thoughts

ExxonMobil's $1 billion commitment is more than just another oil project—it is a strong vote of confidence in Nigeria's energy future. If successfully delivered, the investment could help revive offshore production, attract more foreign capital, and strengthen the country's position as Africa's leading oil producer.

>>> What do you think? Will ExxonMobil's return spark a new wave of foreign investment in Nigeria's oil and gas sector, or are deeper reforms still needed? 

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