NIGERIA Trends and Developments Contributed by: Tosin Ajose, Izuchukwu Ubadinma, Deborah Leshi and Precious Omope, DealHQ Partners
M&A market activities Nigeria’s energy and infrastructure sectors have remained active, reflecting a sustained transition from policy reform to deal execution anchored on the positive, market-friendly posture of the government (sovereign and sub-sovereign). More importantly, reg- ulatory certainty under the ICRC and Highway Devel- opment and Management Initiative frameworks and the PIA have created a transactional environment that reflects compliance, localisation and value optimisa- tion across oil, gas, renewables, power, transport and port infrastructure. Below is a summary of major mar- ket activities recorded between Q4 2024 and Q3 2025. Upstream asset divestments The upstream oil and gas sector continues to record asset divestments by international operators in a bid to shed mature production assets and focus on lower carbon and higher yield assets. In May 2025, Total- Energies SE announced the sale of its 12.5% non- operated interest in the OML 118 Production Sharing Contract (Bonga Field) to Shell plc for USD510 million. This divestment reflects a broader industry trend of portfolio rationalisation, while simultaneously sup- porting increased domestic participation in upstream asset ownership. Other notable divestment transactions within the period include: • Shell’s USD2.4 billion sale of its onshore subsidiary (SPDC) to the Renaissance Africa Energy consor- tium; • ExxonMobil’s USD1.28 billion divestment of its shallow water assets to Seplat Energy; • Eni’s sale of its USD783 million Nigerian onshore assets (NAOC) to Oando PLC; and • TotalEnergies’ divestment of its stake in the SPDC joint venture to Chappal Energies. These asset divestments have added approximately 200,000 barrels per day to Nigeria’s crude output whilst unlocking over USD5.5 billion in Final Invest- ment Decisions. However, whilst increased partici- pation by local operators is a positive development, these divestments often come with substantial oper- ational and legacy risks, including security, ageing infrastructure and huge environmental liabilities.
Asset retirement (decommissioning and abandonment liability)
In response to heightened divestment of core upstream assets, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is driving a more responsible abandonment and decommissioning policy, together with host communities’ environmental remediation plans. The NUPRC has recently secured over USD400 million in decommissioning and aban- donment liability, reinforcing a new regime of asset retirement compliance. Gas monetisation and infrastructure expansion Over the past year, the federal government of Nigeria has adopted a more defined and assertive approach to domestic gas monetisation, shifting from policy intention to practical execution in line with its “Dec- ades of Gas Policy”. This includes accelerating gas infrastructure projects, securing industrial buyers and prioritising domestic gas supply for power genera- tion and manufacturing in a bid to stimulate industrial growth. To support this, significant investment is being chan- nelled into domestic gas-processing and distribution facilities, including the construction and commission- ing of five mini-LNG plants in Ajaokuta, Kogi State, with a combined capacity of 97 mmscf/d, developed by NNPC Ltd and partners such as NNPC Prime LNG and BUA LNG. These facilities are intended to sup- ply gas to regions outside existing pipeline corridors, reduce reliance on carbon-intensive fuels, and anchor new industrial clusters. This domestic infrastructure build-out is complemented by the ongoing Ajaokuta– Kaduna–Kano (AKK) gas pipeline, currently reported to be 86% complete, which is expected to play a central role in Nigeria’s industrialisation and power- stability agenda. Alongside this domestic push, Nigeria is simultane- ously expanding large-scale regional export infra- structure to diversify revenue streams and enhance its strategic position in the global gas markets. The most significant of these is the proposed USD25 bil- lion Nigeria–Morocco Gas Pipeline, a 6,000 km off- shore pipeline designed to deliver up to 30 billion cubic meters of gas annually across 13 West African countries and onward into Europe. With feasibility
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