Efforts to revitalize Nigeria’s oil sector are bearing fruit, with Chevron Nigeria Limited announcing its third exploration success since late 2024, demonstrating new confidence in Africa’s largest oil producer after years of underinvestment and regulatory uncertainty.
A joint venture between the Nigerian National Oil Company Limited and Chevron Nigeria Limited completed the Awodi-07 appraisal and exploration well shallow offshore in the western Niger Delta on December 28, discovering approximately 675 feet of hydrocarbon deposits across multiple reservoirs. The well reached a total depth of 12,420 feet in less than three weeks, but was plugged and shut down after wireline and fluid sampling operations.
The discovery classifies 310 feet of assessed reservoir consistent with pre-drill expectations and 365 feet of overall exploration sand containing six hydrocarbons, unlocking significant development potential in an area where existing infrastructure can accelerate production schedules.
“This success demonstrates the strength of our exploration program and the value of our collaboration with our senior partner, NNPC,” said Jim Swartz, Chevron Nigeria/Central Africa Chairman and Managing Director.
The partnership underscores a strategic shift towards cooperative development following the passage of the Petroleum Industry Act, which streamlines accounting conditions and regulatory processes that have hindered investment for more than a decade.
Kevin McLachlan, Chevron’s vice president of exploration, highlighted the broader strategic context, saying, “All three discoveries complement Chevron’s global exploration strategy, which balances infrastructure-ready and frontier activities.” This approach prioritizes near-field discoveries that can leverage existing facilities, reducing development costs and speeding time to market. This is a key factor as international oil companies face pressure to improve capital efficiency.
The timing proves critical for Nigeria, which has struggled to meet OPEC production quotas amid pipeline theft, regulatory delays and competition from deepwater projects in Guyana and Suriname. The Petroleum Industry Act, enacted in 2021 after two decades of legislative wrangling, introduced tax incentives for remote basins, clarified obligations for host communities, and established clearer timelines for regulatory approvals.
Industry analysts say Chevron’s three recent successes, concentrated in shallow areas where infrastructure already exists, confirms the reform agenda pursued by President Bola Tinubu’s administration. The government has prioritized the revival of the oil sector as essential for stabilizing foreign exchange earnings and securing financial resources for the federal budget, with approximately 50% of the federal budget coming from oil revenues.
The discovery also comes as Nigeria seeks to reverse production declines to more than 2 million barrels per day in 2023, down from 2 million barrels per day a decade ago. Chevron’s focus on “extending the life of production assets in existing business areas” is consistent with the national goal of maximizing recoveries from mature areas while containing development costs.
The NNPCL/CNL joint venture highlighted continued collaboration with regulators and stakeholders to ensure compliance and signaled the partnership approach that is at the heart of Nigeria’s investment pitch as it competes globally for exploration capital in the energy transition era.
