Africa's top oil producer, Nigeria, needs annual investments of $25 billion to reach and keep its output at around 2 million barrels per day (bpd), Nigerian oil industry executive Austin Avuru said this week.
"We need to invest $25 billion annually to stabilize production at 2 million barrels per day," said Avuru, who is executive chairman of AA Holdings.
This investment level "is crucial to ensure the sustainability of the sector and its contribution to the national economy," the executive added at an event in Nigeria, as carried by local daily Business Day.
Investments in Nigeria's oil sector peaked in 2014 when the industry saw a total investment of $22.1 billion, Avuru noted.
Raising oil production has been a key priority for the Nigerian federal government, which aims to thus boost revenues and foreign exchange reserves.
OPEC member Nigeria aims to ramp up its oil production in the coming months and years.
Oil theft and pipeline vandalism have long plagued Nigeria's upstream oil and gas industry, driving majors out of the country and often resulting in force majeure at the key crude oil export terminals.
The combination of pipeline vandalism and oil theft with a lack of investment in capacity has made Nigeria the biggest laggard in crude oil production in the OPEC+ alliance.
In early May, Nigeria launched a new oil and gas licensing round, inviting bids for as many as 12 onshore and offshore blocks and promising transparency in the bidding process.
International majors have shrunk their exposure to Nigeria's energy sector in recent years, with transparency in the licensing rounds one of the reasons for Big Oil to divest from their Nigerian assets, on top of oil theft and frequent pipeline damages.
Nigerian oil production has started to recover in recent months and hit in February its highest level in more than three years amid a concerted effort to crack down on targeted attacks and organized theft rings.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More