From reviving idle oil fields to meeting the 2 million barrels per day production target, Bayo Ojulari, the new group chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited faces a daunting array of challenges that will test his leadership and strategic acumen.

President Bola Tinubu on Wednesday shifted his focus to overhauling the state oil firm in a bid to maximise its contribution to the country?s revenue and attract more oil investors after ending costly subsidies and twice devaluing the naira currency in his first year in office. ?Ojulari?s appointment, and the wider changes to the NNPC board, show Tinubu tapping the best of Nigeria?s E&P talent to tackle the many challenges at the firm, and to improve the country?s investment appeal,? said Clementine Wallop, director for sub-Saharan Africa at consultancy Horizon Engage told S&P Global.

?Looking at the names on the board, there?s an emphasis on gas and deepwater experience; that?s aligned with the way International Energy Companies see Nigeria now, and with Tinubu?s own energy priorities,? Wallop said.

At first glance, the numbers are impressive for investors.

NNPC is the largest oil and gas company in Africa. In 2023, it reported a N3.3 trillion ($ 2.1 billion) net profit, with an asset base exceeding N16 trillion.

Nigeria?s oil reserves are estimated at 37 billion barrels, and NNPC has set an ambitious target of producing 2 million barrels per day in the near term, with plans to ramp up to 4 million barrels per day by 2030.

Today, however, global oil investors don?t just buy barrels or production forecasts, they want more.

Green bonds, AI unicorns, renewable infrastructure funds are all competing for limited global capital pools.

For a national oil company in 2025, the competition isn?t just ExxonMobil or Aramco, it?s Tesla, private equity funds, and sovereign wealth funds with strict ESG mandates.

To entice investors, here are seven key contentious issues awaiting the new NNPC leadership.

Meeting Tinubu?s target

Nigeria under Tinubu aims to boost its oil and gas output, targeting 2 million barrels per day of oil and 8 billion standard cubic feet per day of gas by 2027, with further ambitions to reach 3 million barrels per day and 10 billion standard cubic feet per day by 2030.

Tinubu has also tasked the new Ojulari-led NNPC with raising the company?s oil refining output to 200,000 barrels per day by 2027, and 500,000 barrels per day by 2030, despite its underperforming refineries.

The Nigerian government is counting on oil to help shore up the battered naira, and industry operators said it must decisively ramp up oil production to two million barrels per day (bpd) consistently to achieve that objective.

The country?s oil and gas sector, which has generated a significant chunk of government revenue and foreign exchange earnings for many years, is teetering and in desperate need of rescue.

Olusegun Omisakin, director of research and chief economist at the Nigeria Economic Summit Group, said Nigeria can?t get better when crude oil production is below two million barrels daily.

?We are barely touching what we have, you know. For some years now and currently, we are doing below two million barrels of oil production per day. We cannot continue to dream of a better country when we don?t know how to optimise our national resources,? Omisakin said at a quarterly macro-economic outlook webinar monitored by BusinessDay.

Security for oil assets, many analysts say, has not been treated with the seriousness it deserves, considering that oil is responsible for the nation?s revenue. Militants routinely kidnap oil workers, especially expatriates, and sabotage of oil pipelines occurs too frequently to absolve government officials, including security personnel, of collusion with criminals.

Refineries: Revamp, concession, or scrap?

NNPC?s promise to revive the nation?s moribund refineries remains unfulfilled. The Port Harcourt, Warri, and Kaduna refineries have gulped billions in repairs but are yet to operate at full capacity.

The refineries? long history of decay and wasteful spending on turnaround maintenance has triggered an increased feeling of bitterness in the hearts of many Nigerians whenever they hear billions of dollars the refinery has sucked.

They question why the government keeps throwing money into a system that is entrenched in a culture of waste that has gulped far too much public funds while its inflated payrolls contribute to the non-competitive cost of fuels produced.

With the Dangote Refinery now operational, pressure is mounting on NNPC to deliver on its refinery rehabilitation pledges or face criticism over continued fuel import dependence.

AKK gas pipeline project delays

The $2.8 billion Ajaokuta-Kaduna-Kano (AKK) gas pipeline, a critical infrastructure project designed to boost domestic gas supply and industrial growth, has faced repeated delays.

The AKK gas pipeline project runs from Ajaokuta in Kogi State to Kano, delivering gas to major cities like Abuja and Kaduna along the route; it is considered a key project to boost Nigeria?s industrialization by providing gas for power generation, industries, and residential use.

Construction of the Ajaokuta-Kaduna-Kano (AKK) pipeline began in June 2020, with NNPC promising it would help generate 3.6 gigawatt of power and support gas-based industries along the route when completed.

BusinessDay findings showed funding constraints and contractual disputes have slowed progress despite the AKK project being a priority for the federal government.

Idle oil blocs & under-utilised assets

Despite Nigeria sitting atop 36 billion barrels of crude oil reserves and 206 trillion cubic feet of proven gas reserves, Nigeria has many revenue problems, and one of its most notorious issues is unproductive oil blocs.

The issue is not an easy one to understand because it has several layers with many different sides.

Numerous oil blocs remain underdeveloped due to regulatory bottlenecks, funding gaps, and investor apathy.

Oil receipts fund the country?s budget, but many oil and gas projects lie idle, threatening the target set over a decade ago to raise reserves to 40 billion barrels.

These big-ticket projects include: Zabazaba?s 150,000 bpd; Chevron Nsiko project,100,000 bpd; Exxonmobil?s Bosi, 140,000 bpd; Satellite Field development phase, 80,000 bpd; and Ude, 110,000 bpd.

Experts said Ojulari must address the inefficiencies in licensing and attract competent players to unlock these resources as failure to do so could further stifle production growth amid declining output in key fields.

NNPC?s long-awaited IPO

The planned initial public offering (IPO) for NNPC Limited, intended to transform the state oil firm into a more commercially viable entity, has stalled.

Transparency concerns, weak financial performance, and volatile oil prices have deterred investors.

?Investors are not lining up to buy yesterday?s oil narrative. They are buying what?s next; energy transition readiness, downstream integration, gas infrastructure dominance, regional leadership in energy supply,? a senior executive in upstream business told BusinessDay.

He added, ?NNPC?s pitch must move beyond crude oil barrels. It must articulate a strategic future, one that speaks to how this IPO positions NNPC as an indispensable player in Africa?s energy security and transition. When Aramco went public, it sold itself not just as the world?s biggest oil company, but as a modernised, tech-enabled, future-facing energy powerhouse.?

Attracting Foreign Direct Investment (FDI)

When an oil executive said Nigeria needed $25 billion per annum in investments to be able to achieve a production target of 2 million barrels daily, the task at hand for Nigeria came into better perspective.

The 2010s witnessed a period of significant FDI from international companies eager to tap into the country?s vast oil and gas reserves as the future for Nigeria?s nascent indigenous upstream oil and gas industry looked bright, almost dazzlingly so.

In 2014, Nigeria attracted the largest amount of FDI of any African country, with inflows exceeding $22.1 billion. This influx of capital fueled major projects, including deepwater exploration and development of new oil fields.

Ojulari must work with regulators to create a more investor-friendly climate, ensuring Nigeria remains competitive against rivals like Angola and Namibia, which are drawing major oil investments.

Naira for crude deal

There is anxiety in the downstream arm of the oil and gas sector as operators await the decision of the Federal Government on the naira-for-crude deal between the NNPC and the Dangote Petroleum Refinery.

The six-month deal, which started in October 2024, ended March 31, 2025. The deal?s extension or complete halt is still being discussed by the parties involved.

It was gathered on Wednesday, however, that the committee responsible for the negotiations has yet to resolve the matter. As this lingers, the effect is now felt in the pump prices of refined petroleum products. (BusinessDay)

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