KEY POINTS
- Nigeria attracted $5.3 billion in upstream oil and gas investment.
- Shell-Sunlink HI Field reached final investment decision in 2025.
- Nigeria captured 38 percent of Africa’s recent upstream investments.
Nigeria retained its position as Sub-Saharan Africa’s top destination for upstream oil and gas investment in 2025, drawing $5.3 billion in capital expenditure even as the wider region saw spending fall 18 percent, according to Wood Mackenzie. The country’s ability to secure one of only two final investment decisions last year highlights a striking shift in its competitiveness across African energy markets.
Policy reforms attract major investors
The Shell-Sunlink HI Field (OML 144), a shallow-water non-associated gas project, reached final investment decision following Nigeria’s Non-Associated Gas incentives introduced in 2024. Industry analysts say the move restored commercial viability for the project and unlocked critical feedstock for Nigeria’s liquefied natural gas sector. The FID represents a milestone in the country’s efforts to monetize its extensive gas reserves and strengthen domestic supply.
Angola, Nigeria’s traditional rival for African energy investments, secured the second spot with upstream capital expenditure just above $500 million. Most of Angola’s spending came from projects run by its national oil company and major international operators, though the total lagged far behind Nigeria’s $5.3 billion tally.
Nigeria captures growing regional share
Between 2015 and 2023, Nigeria accounted for only 4 percent of sanctioned African FIDs, capturing $5 billion across six of 44 projects continent-wide. Over the past two years, however, the country has drawn 38 percent of regional upstream investment, totaling $8 billion across five of eight projects. Analysts attribute this turnaround to competitive fiscal terms for deep-water developments, enhanced gas incentives, and regulatory reforms that reduced policy uncertainty.
The broader Sub-Saharan sector faced persistent challenges in 2025. Total capital expenditure fell 18 percent, with only two FIDs recorded across the entire region. Countries such as Mozambique, Congo, Uganda, Côte d’Ivoire, Ghana, and Gabon saw upstream investments exceeding $500 million, but most spending was concentrated in Nigeria and Angola, according to Business Day. Stable fiscal regimes, existing infrastructure, and proximity to export markets made these two nations attractive destinations for energy capital.
Looking ahead, Wood Mackenzie anticipates additional FIDs in Nigeria as policy reforms mature. Analysts say the country’s combination of competitive fiscal terms and regulatory stability sets a new benchmark for Africa, reinforcing that governance and policy certainty are now as important as reserves in attracting global investment.
