Report Predicts Significant Developments in Nigeria’s Energy Sector in Q1 2025
Ejiofor Alike
The Nigerian energy sector will witness significant developments in the first quarter (Q1) of 2025, a new report by the Society of Energy Editors (SEE) has revealed.
The report noted that these developments would be driven by President Bola Tinubu’s proposed N49.7 trillion budget for the year.
The budget, which is anchored on 2.06 million barrels per day crude oil production target, is expected to drive down inflation from 34.6 per cent to 15 per cent during the year under review.
In its, “Nigeria Energy Outlook Q1 2025,” SEE highlighted key areas to watch in the energy sector in the first quarter of the year to include oil oil exploration and production; domestic crude refining; gas production and liquefied natural gas (LNG) export; power generation and transmission as well as labour relations.
“The government’s target to increase crude oil production is ambitious, but its feasibility hinges on addressing security challenges, particularly in the Niger Delta region. Nigeria plans to hold a fresh oil licensing round in 2025 focused primarily on handing out blocks that remained undeveloped, as the country battles to raise crude reserves and production,” the report explained.
The report added that the federal government would have to show the necessary political will for this fresh oil licensing round to be organised in the year under review as planned.
On domestic refining, SEE noted that the commencement of petroleum refining at the Dangote Refinery is expected to reduce fuel imports and ease the burden of petroleum subsidies.
It, however, added that the steady supply of crude oil feedstock from the NNPC Ltd. to the refinery will be crucial in determining the refinery’s impact on the economy in 2025.
Focusing on gas production and LNG exports, the report projected that Nigeria’s gas sector will grow during the first quarter, driven by the government’s “Decade of Gas” initiative and the country’s ambitions to increase its gas reserves to 210 trillion cubic feet (Tcf) in 2025 and 220 Tcf by 2030.
According to the report, gas export through the Nigeria LNG Limited will be steady during the first quarter.
In the power sector, the report said efforts to expand power generation and improve transmission infrastructure will continue, with a focus on increasing the share of renewable energy sources in the energy mix.
It maintained that power transmission and distribution infrastructure remained very weak with the national grid recording 12 incidents of collapse in 2024.
