The aboundance of oil and gas in Nigeria can not be over emphasised. The country is ranked as the tenth most petroleum-rich nation in the world, and largest producer of oil in Africa. Oil and gas exports account for more than 95% of Nigeria's export earnings. The country's proven oil reserves are estimated at between 16 and 22 billion barrels while some sources claim there could be as much as 35.3 billion barrels. Most of Nigeria's oil is found in the Niger Delta. Shell Nigeria is by far the largest oil producer but other companies such as Exxon-Mobil, Agip and Total also operate in country. Nigeria is also rich in natural gas reserves. The industry is dominated by the Nigerian Liquefied Natural Gas Company, a joint venture between several companies and the state.

The cost of production per barrels of crude oil in Nigeria is one of the lowest world wide. Huge reservoirs of hydrocarbon are also found in Nigeria.
There are two types of licenses issued to oil producers in Nigeria namely: the Oil Prospecting License (OPL) and the Oil Mining License (OML) with validity periods ranging from 5 to 20 years respectively.

Investment opportunities in the downstream sector include:
  1. Domestic Production and Marketing of Liquefied Natural Gas (LPG).
  2. Domestic Manufacturing of LPG cylinders, valves and regulators, installation of filling plants, retail distribution and development of simple, flexible and less expensive gas burners to encourage the use of gas instead of wood.
  3. Establishment of processing plants and industries for the production of:
  4. Establishment of chemical indus tries e.g. distillation units for the production of Naphtha and other special boiling point solvents used in food processing.
  5. Linear Alkyl Benzene, Carbon Black and Polypropylene producing industries.
  6. Development of Phase II (Phase III to commence later) in Nigeria’s Petrochemical Programme.
  7. The NLNG Projects.
  8. Small-scale production of chemicals and solvents e.g. chlorinated methane, Formaldehyde, Acetylene etc. from natural gas.
  9. Crude oil refining with efficient export facilities.
    Companies with the technology can undertake turn around maintenance of refineries. There is a tremendous scope for small-scale joint venture manufacturing concerns with foreign technical partners. Such ventures can start warehousing arrangements that will ensure continuity of supply at competitive prices.
  10. Products Transportation and Marketing Associated with products distribution and marketing is a chain of manufacturing and maintenance businesses e.g. Lubricating Oil reprocessing, LPG bottles and accessories, oil cans reconditioning etc.
Upstream Investment Opportunities
 There are numerous investment opportunities available in upstream operations of the Petroleum industry in Nigeria as presented below: