Nigeria's Energy Investment Could Double in Five Years

The Executive Director of the International Energy Agency, Faith Birol, believes Nigeria’s investment in its energy sector could double in the next five years as an associate member.

He spoke to Reuters on Thursday in Abuja. He mentioned that Nigeria’s new status as an associate member of the Paris-based agency could bring in foreign investment.

Nigeria joined the IEA as its 14th associate member in July. This happened after the US, Germany, Italy, and other member countries voted in favor. With this, Nigeria became the first member of the Organisation of Petroleum Exporting Countries (OPEC) to join the IEA.

Mr Birol stated that this new arrangement would give Nigeria, Africa’s largest oil producer, a stronger voice in global energy policy talks.

Nigeria aims to double its energy sector investment within five years, and the IEA will support this goal, according to Mr Birol.

Meanwhile, IEA member countries are looking for partners they can trust. This comes after supply disruptions from the wars in Iran and Ukraine.

The IEA chief pointed out that disruptions to major energy supply routes are changing global trade flows. He said, “Countries have been reassessing energy partnerships and supply chains following market disruptions caused by Russia’s full-scale invasion of Ukraine and instability along key shipping routes.”

He added, “If the Strait of Hormuz is not going to open convincingly sometime soon, we may have some difficulties both in terms of crude oil, but especially on products such as diesel and jet fuel.”

He described Nigeria as a reliable energy supplier. He noted that exports from the Dangote refinery have helped ease fuel supply issues in Europe recently.

The Dangote refinery processes around 700,000 barrels of crude oil per day. He mentioned that Nigeria’s new status, along with global realities, could attract governments and private investors looking for dependable energy partners.

“The most scarce commodity is not oil, not gas, not uranium, not lithium. It is trust,” he said. “Countries are looking for partners they can rely on.”

“My goal is, in a very short period of time, in five years, to at least double the energy investments Nigeria is receiving today,” he stated.

The IEA and Nigeria plan to sign a joint work program during Mr Birol’s visit. The program will focus on cooperation in areas like natural gas, electrification, clean cooking, energy efficiency, and energy data development.

Mr Birol also mentioned that Nigeria is working with the IEA to improve its energy data collection and reporting systems.