ExxonMobil has announced a $1 billion investment in Nigeria’s offshore oil sector, marking its return to drilling operations in the country for the first time since 2016.
The project, which will be executed through its Nigerian affiliate, Esso Exploration and Production Nigeria (Offshore East) Limited, involves the Usan Infill Project located in Oil Mining Lease (OML) 138. The development is expected to deliver first oil within the next 18 months by increasing output from the Usan Floating Production, Storage and Offloading (FPSO) facility through the drilling of new infill wells identified after seismic surveys conducted in 2024.
The investment is being financed by Esso and its partners in OML 138, including Chevron, TotalEnergies and Nexen, a subsidiary of China’s CNOOC, under a production-sharing agreement with NNPC Limited.
The project represents a major boost for Nigeria’s oil industry, which has experienced declining investment from international oil companies over the past decade due to regulatory challenges, crude oil theft, security concerns and prolonged underinvestment.
Although several multinational energy firms have reduced their presence in onshore and shallow-water operations, many have shifted their attention to deepwater assets, which are generally regarded as more secure and commercially viable.
Industry stakeholders believe the investment also reflects growing confidence in reforms introduced through the Petroleum Industry Act (PIA), which aims to attract new capital into Nigeria’s upstream petroleum sector and improve crude oil production.
Speaking at the project’s launch during NOG Energy Week in Abuja, the Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Oritsemyiwa Eyesan, described the development as a significant milestone for Nigeria’s deepwater industry.
She noted that ExxonMobil’s return to drilling after nearly a decade demonstrates renewed confidence in the country’s offshore potential and said the investment is expected to unlock approximately 40,000 barrels of additional oil production.
According to the NUPRC chief, many of Nigeria’s deepwater assets have been operating below capacity for years, making the new investment particularly important for revitalising the sector.
ExxonMobil stated that the Usan Infill Project aligns with its long-term strategy of expanding its deepwater operations in Nigeria following the sale of most of its shallow-water assets.
The company said it plans to use advanced technology and its operational expertise to safely increase production while contributing to Nigeria’s economic growth and delivering value to stakeholders.
ExxonMobil also acknowledged the support of the NUPRC, the Nigerian Content Development and Monitoring Board (NCDMB), NNPC Limited and its joint venture partners in advancing the project.
The Usan oil field has been in production since 2012. Rather than developing a completely new field, the infill project will target additional reserves around existing infrastructure, enabling faster and more cost-effective production.
The announcement comes as Nigeria intensifies efforts to raise crude oil output and attract fresh investment into its upstream petroleum industry. During the same event, the NUPRC also presented 19 petroleum prospecting licences awarded under the 2022/2023 Mini Bid Round and the 2024 Licensing Round as part of broader initiatives to stimulate exploration and production.
