By Iroyin Yoruba Television News Desk
Nigeria’s upstream oil and gas sector has attracted fresh international attention after Pertamina, Indonesia’s state-owned energy company, expressed interest in participating in Nigeria’s 2026 oil licensing round and exploring producing and near-production assets in the country.
The development followed discussions between the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and senior Indonesian officials, including Pertamina’s Vice President for Upstream Business Development, Toriq Abdat, and Indonesia’s Vice Minister of Foreign Affairs, Arif Havas Oegroseno.
The talks are part of Nigeria’s continuing effort to attract additional investment into the upstream petroleum sector and increase crude oil production.
NUPRC Chief Executive Oritsemeyiwa Eyesan said Nigeria and Indonesia share important interests in energy security, resource utilisation and investment.
Pertamina’s interest is significant because the Indonesian company is looking beyond its domestic market for upstream opportunities as it seeks to expand its international operations.
According to information released following the discussions, the company is considering opportunities in Nigeria that include producing assets, projects approaching final investment decisions and opportunities available through the 2026 licensing round.
The engagement does not mean that Pertamina has already acquired Nigerian oil assets.
Rather, the company is exploring investment opportunities and assessing projects through discussions with the Nigerian regulator.
That distinction is important because participation in a licensing round involves several stages before an investor ultimately obtains a petroleum asset.
Pertamina is Indonesia’s national oil company and has operations covering different areas of the energy industry.
Its international expansion strategy has increasingly involved searching for opportunities outside Indonesia.
During the discussions with NUPRC, Abdat explained that Pertamina had been mandated to expand its international upstream operations.
The company is looking at countries and projects where it can secure producing assets or participate in projects that are close to production.
Nigeria is among the countries being considered.
Pertamina’s interest extends beyond simply buying existing producing fields.
The company has indicated interest in projects approaching Final Investment Decision, commonly referred to as FID.
FID is an important stage in petroleum development.
It is the point at which investors make a formal decision to commit significant capital to a project after assessing technical, commercial, regulatory and financial considerations.
A project approaching FID may already have undergone extensive exploration and appraisal work but still require substantial investment before construction or full development begins.
For an investor such as Pertamina, participating at that stage can provide an opportunity to enter a project with a clearer understanding of its technical and commercial potential.
Nigeria, meanwhile, wants to use such opportunities to increase upstream investment and raise production.
Nigeria’s 2026 licensing round is being positioned as another opportunity for investors to gain access to petroleum acreage.
The NUPRC has been working to make licensing rounds more regular and predictable under the framework established by the Petroleum Industry Act, 2021.
The regulator has argued that predictable access to acreage can help investors plan long-term exploration and development programmes.
The 2026 exercise follows the recently completed 2025 licensing round.
That earlier round attracted significant interest.
According to NUPRC, 143 companies submitted 200 bids for 37 of the 50 oil and gas blocks originally offered.
A total of 31 companies emerged as winners of 37 blocks after the evaluation process.
The blocks covered different geological areas, including the Niger Delta, shallow-water and deep-offshore areas, as well as frontier basins such as the Benue Trough, Chad Basin, Anambra Basin and Benin Basin.
The results demonstrated interest in areas that have historically received less exploration activity.
The NUPRC subsequently indicated that the next licensing round would provide another set of opportunities.
The regulator has also introduced measures intended to reduce barriers to investment and make the licensing process more competitive.
One of the main issues surrounding the renewed interest in Nigeria’s upstream industry is the country’s production target.
Nigeria has stated an ambition to increase crude oil production to approximately three million barrels per day by 2030.
NUPRC has acknowledged that achieving that target will require substantial investment.
Current production remains below the three-million-barrel target.
The regulator has therefore identified licensing rounds, development of existing assets, new exploration and improved investment conditions as parts of the strategy for increasing output.
Eyesan told the Indonesian delegation that Nigeria’s production target was ambitious but that the country remained committed to achieving it.
The 2026 licensing round is consequently being presented as one of the mechanisms through which additional acreage and investment can be brought into the upstream sector.
However, securing licences alone does not automatically translate into increased production.
Investors must undertake exploration, appraisal, field development, drilling, infrastructure construction and production activities.
This is why NUPRC has also emphasised the importance of its “drill or drop” approach.
Under that regulatory philosophy, companies holding petroleum assets are expected to develop them within the applicable requirements rather than retaining acreage without meaningful activity.
The NUPRC has increasingly stressed that Nigeria cannot afford to have large areas of petroleum acreage remain inactive for extended periods.
The regulator has therefore sought to ensure that licences are linked to actual investment and development.
The approach is designed to encourage companies to either move their assets towards exploration and production or relinquish acreage where they are unable or unwilling to develop it.
This policy is relevant to the 2026 licensing round because potential investors will be entering a regulatory environment where holding acreage without fulfilling development obligations may carry consequences.
For Nigeria, the objective is to transform awarded acreage into actual exploration and production activity.
For investors, it means that licensing decisions have to be accompanied by credible technical and financial plans.
The success of the licensing process will ultimately depend not only on how many companies participate but on how many projects progress from licensing to drilling and eventually commercial production.
The petroleum industry requires substantial capital.
Exploration wells can require significant financial commitments, particularly in deepwater and frontier areas.
Developing offshore fields also requires specialised drilling equipment, subsea infrastructure, pipelines, floating production facilities and extensive engineering work.
Nigeria therefore depends on a combination of domestic and international capital to develop its petroleum resources.
International companies can bring not only money but also technology, technical expertise, project-management experience and access to international supply chains.
At the same time, the Nigerian government expects petroleum investments to generate revenue, employment, local contracting opportunities and energy supplies.
The challenge is to create conditions that attract investors while protecting national interests and ensuring that petroleum resources are developed under transparent and enforceable rules.
The NUPRC’s discussions with Pertamina are taking place within this broader investment environment.
The discussions between Nigeria and Indonesia were not limited to crude oil.
Pertamina also indicated interest in opportunities connected to natural gas and fertiliser production.
The company has been developing fertiliser-related activities in Indonesia and is looking for ways to strengthen supplies of key agricultural inputs.
That creates an area of potential cooperation with Nigeria.
Nigeria possesses significant natural gas resources, while gas is also an important feedstock for fertiliser production.
The relationship between hydrocarbons and agriculture is therefore broader than petroleum exports.
Gas can be used in fertiliser manufacturing, while fertiliser availability affects agricultural production and food security.
For Nigeria, developing gas-based industries could also create additional value from resources that might otherwise be exported as raw materials.
The government has repeatedly promoted gas as a major part of the country’s energy and industrial development strategy.
Pertamina’s interest in fertiliser and related opportunities could therefore expand the potential areas of cooperation between the two countries beyond upstream oil production.
Nigeria and Indonesia are both major developing economies with substantial energy resources, but their petroleum sectors face different challenges.
Indonesia produces substantially less crude oil than Nigeria and has experienced declining domestic production over the years.
The Indonesian government has been seeking additional investment and international opportunities as it attempts to increase production.
Pertamina’s international expansion is partly connected to this effort.
For Indonesia, acquiring overseas petroleum assets can provide an additional source of production and energy security.
For Nigeria, attracting an experienced national oil company provides another potential source of investment into domestic petroleum projects.
The two countries therefore have complementary interests.
Indonesia is seeking international upstream opportunities, while Nigeria is seeking additional capital and technical participation in its petroleum sector.
The NUPRC is responsible for regulating Nigeria’s upstream petroleum industry.
Its responsibilities include licensing, regulation of exploration and production activities, administration of petroleum acreage and oversight of operators within the upstream sector.
The commission has been trying to improve the investment environment by providing greater predictability around licensing opportunities.
Regular licensing rounds can give companies clearer information about when new acreage may become available.
This is important for international companies because petroleum investments often require years of planning.
An investor may need to conduct technical studies, geological analysis, financial modelling, environmental assessments and commercial negotiations before committing large amounts of capital.
Predictability in the licensing system can therefore reduce uncertainty.
The regulator has also highlighted the need for transparent bidding processes.
During the 2025 licensing round, NUPRC said the evaluation was based on published criteria.
The commission has stated that the same emphasis on transparency, competitiveness and performance would continue.
The outcome of the 2025 licensing round provides important background to the 2026 exercise.
The 2025 process began with the offering of 50 blocks.
According to NUPRC, 37 of those blocks attracted bids.
The 143 participating companies submitted 200 bids.
Following evaluation, 31 companies emerged as successful bidders for the 37 blocks.
The blocks were spread across several geological terrains.
This was significant because some of the areas involved frontier basins where commercial exploration has historically been limited.
NUPRC described the level of investor interest in those frontier areas as unprecedented in Nigeria’s energy history.
However, winning a bid is not the final step.
Successful bidders must meet applicable financial and regulatory obligations before final awards are completed.
The NUPRC has also warned successful companies that assets must be developed in line with the regulatory framework.
The lesson for the 2026 round is that the country is seeking not just bidders but investors capable of converting acreage into productive petroleum assets.
Producing assets can be attractive to international energy companies because they can provide a clearer path to revenue than an unexplored block.
An exploration block may require years of geological studies and drilling before commercial reserves are established.
A producing field has already passed several stages of technical assessment.
However, producing assets also come with their own challenges.
Fields may require additional investment to maintain or increase production.
Some mature assets may experience declining output.
Infrastructure can require rehabilitation.
Environmental obligations may also be significant.
An investor therefore has to evaluate not only the amount of oil remaining in a field but also operating costs, infrastructure, fiscal terms, security, regulatory requirements and the investment needed to maintain production.
Pertamina’s interest in producing and near-production assets indicates that the company is looking for opportunities where development can potentially move more quickly than in entirely unexplored acreage.
Projects approaching FID occupy another important category.
Such projects may already have established resources and completed substantial technical studies.
They may also have identified development concepts and estimated capital requirements.
The remaining decision is whether the commercial conditions justify committing the required investment.
For Nigeria, attracting investors into near-FID projects can accelerate the transition from discovery or appraisal into development.
It can also help prevent discovered resources from remaining undeveloped for long periods.
For investors, near-FID projects can reduce some of the geological uncertainty associated with early exploration.
Nevertheless, financial and regulatory risks remain.
The cost of developing petroleum projects can change significantly because of inflation, exchange rates, equipment costs, financing conditions and changes in global energy markets.
Nigeria is competing with other oil-producing countries for international investment.
International petroleum companies and national oil companies have limited capital and must decide where to allocate funds.
Countries therefore compete through fiscal terms, regulatory certainty, infrastructure, security, geological prospects and ease of doing business.
Nigeria’s recent reforms have been designed partly to improve its competitiveness.
The Petroleum Industry Act changed aspects of the legal and regulatory structure of the petroleum sector.
The government and NUPRC have subsequently introduced measures intended to encourage investment.
The success of those reforms will ultimately be measured by actual capital deployment, drilling activity and production growth rather than announcements alone.
Pertamina’s interest is therefore one indicator of international attention, but any eventual investment would still depend on commercial negotiations and regulatory processes.
Investment decisions in Nigeria’s petroleum sector are also influenced by security and infrastructure.
The Niger Delta has extensive petroleum infrastructure, including pipelines, terminals and production facilities.
The region has historically experienced challenges involving crude theft, pipeline vandalism and other disruptions.
Offshore projects have different operational requirements but can also face high development costs.
Infrastructure availability is particularly important for new fields.
An oil discovery cannot become a commercial project without a means of transporting and processing the petroleum.
Gas projects similarly require gathering, processing and transportation infrastructure.
Nigeria has therefore been investing attention in both upstream production and midstream infrastructure.
The development of gas processing and transportation facilities is important because it can increase the commercial value of gas resources.
Pertamina’s expression of interest does not constitute a completed investment agreement.
The company would need to conduct further technical and commercial assessments.
If it decides to participate in the licensing round, it would have to follow the applicable procedures established by NUPRC.
For existing producing assets, additional negotiations would be necessary with the relevant owners and stakeholders.
Any acquisition or participation would also be subject to applicable regulatory approvals.
This means the current development should be understood as the beginning of a potential investment process rather than the conclusion of one.
The discussions nevertheless create a channel through which the Nigerian regulator and Indonesian energy company can examine specific opportunities.
If the engagement eventually produces investments, Nigeria could benefit from additional capital entering the upstream sector.
Potential benefits could include new drilling activity, development of existing discoveries, additional production, service contracts and employment.
There could also be opportunities for Nigerian oilfield-service companies if foreign investors increase their operations.
However, the scale and timing of any benefits would depend on the specific projects eventually selected.
An expression of interest by itself does not guarantee production growth.
Investment decisions must still be followed by financing, approvals, engineering, procurement, drilling and construction.
The distinction is important because petroleum projects often operate on multi-year development timelines.
The 2026 licensing round is part of a broader effort to make petroleum acreage available on a more regular basis.
For decades, Nigeria’s oil industry was dominated by long-term arrangements involving major international operators and joint ventures.
The regulatory environment is now evolving.
The government wants to encourage new investors while also ensuring that existing assets are actively developed.
National oil companies such as Pertamina can play a role in this changing environment because they often have experience operating in different regulatory jurisdictions.
Their participation could also increase competition for available acreage.
For the latest interest to translate into actual investment, Nigeria will need to maintain regulatory clarity.
Investors need to understand the fiscal framework under which projects will operate.
They also need certainty about licensing procedures, contract terms, environmental requirements, tax obligations and regulatory approvals.
Speed is another factor.
Lengthy approval processes can increase project costs and delay production.
NUPRC has repeatedly said that improving regulatory predictability and efficiency is part of its reform programme.
The commission has also indicated that it wants licensing rounds to be transparent and data-driven.
The 2026 process will provide another opportunity to demonstrate how those principles work in practice.
Nigeria remains heavily dependent on petroleum revenues and therefore has a strong interest in maintaining oil production while also developing its gas sector.
At the same time, global energy markets are changing.
International investors are increasingly assessing not only conventional oil opportunities but also gas, low-carbon technologies and energy-transition risks.
For Nigeria, this means that attracting investment requires presenting projects that remain commercially viable in a changing global environment.
Gas could become increasingly important because of its role in electricity generation, industrial production and fertiliser manufacturing.
Pertamina’s interest in both petroleum and fertiliser-related opportunities therefore illustrates how energy investment can extend across several connected sectors.
For investors, the licensing round provides access to petroleum acreage in one of Africa’s major hydrocarbon-producing countries.
The attractiveness of individual blocks will depend on geological data, expected reserves, fiscal terms, infrastructure and development costs.
Companies will also consider Nigeria’s broader operating environment.
The government, meanwhile, wants investors that can demonstrate the financial and technical capacity to develop assets.
The NUPRC’s drill-or-drop philosophy means that the focus is increasingly moving from simply allocating acreage to ensuring that awarded assets progress towards exploration and production.
That approach could shape how companies evaluate their participation in the 2026 round.
At this stage, there is no indication that Pertamina has concluded a specific acquisition or signed a final investment agreement for a Nigerian petroleum asset as a result of the latest discussions.
The reported development is that the Indonesian company has expressed interest and is examining opportunities.
Further announcements would be required before any particular asset, financial commitment or production target could be attributed to Pertamina’s Nigerian operations.
This distinction is particularly important in the petroleum industry because discussions between regulators and potential investors can continue for months before contracts are finalised.
The NUPRC and Pertamina are expected to continue discussions on potential investment opportunities.
The Nigerian regulator will also continue preparations for the 2026 licensing round.
For Nigeria, the central objective remains increasing investment and production while maintaining regulatory oversight.
For Pertamina, the immediate task is evaluating whether Nigerian projects meet its technical and commercial requirements.
For the wider petroleum industry, the development provides another indication that Nigeria is seeking to attract new participants into its upstream market.
The coming stages will show whether the current discussions result in formal participation in the licensing round, investment in existing producing assets or cooperation in other areas of the petroleum and fertiliser value chain.
Nigeria’s three-million-barrels-per-day production ambition will ultimately depend on more than licensing announcements.
It will require exploration success, field development, infrastructure, financing, operational efficiency and sustained investment.
The interest expressed by Pertamina therefore represents one part of a much larger effort to expand the country’s petroleum production base.
As the 2026 licensing process progresses, investors and industry observers will be watching the terms offered, the companies that participate, the blocks placed on offer and the extent to which successful bidders move from licensing commitments to actual drilling and production.
For Nigeria, the key test will be whether the growing interest in its upstream sector can be converted into concrete investment, new wells, developed fields, increased production and stronger participation across the domestic energy value chain.
