The Petroleum Technology Association of Nigeria (PETAN) has identified inadequate financing, expensive drilling equipment and the loss of skilled professionals as major challenges threatening Nigeria’s ambition to increase crude oil production to three million barrels per day (3mbpd).

The association estimated that approximately $6 billion would be required to acquire the equipment and infrastructure needed to support the production target, warning that the high cost of oilfield machinery continues to limit the capacity of indigenous service companies.

PETAN Chairman, Engr. Wole Ogunsanya, disclosed this during a media roundtable on the state of Nigeria’s oil and gas industry, held in Lagos on Monday, October 26, 2026.

Ogunsanya explained that acquiring a swamp drilling rig could cost between $160 million and $170 million, while land drilling rigs range from $30 million to $40 million, making access to affordable financing essential for local companies seeking to expand their operations.

He noted that more sophisticated offshore equipment, including jack-up rigs, could cost between $300 million and $400 million, depending on their specifications.

According to him, Nigeria possesses substantial oil reserves and the technical potential to expand production, but requires additional drilling rigs, production facilities and pipelines to achieve its targets.

He maintained that the industry’s financing difficulties must be addressed if indigenous companies are to acquire the equipment necessary to undertake larger projects and contribute meaningfully to increased crude production.

Ogunsanya also highlighted the limitations of conventional bank financing, particularly the high collateral requirements and difficulty of securing long-term funding for expensive oilfield equipment.

He called for stronger financial support for indigenous service providers, including improved access to equipment financing through the Nigerian Content Development and Monitoring Board (NCDMB).

The PETAN chairman stressed that Nigeria’s production ambitions would remain difficult to achieve without deliberate investment in the equipment required to develop oilfields, maintain existing facilities and transport crude oil.

Despite the financing challenges, Ogunsanya said the growing participation of indigenous companies has strengthened competition in Nigeria’s oilfield services market.

He explained that Nigerian service providers had developed the technical capacity to execute projects previously dominated by multinational oilfield service companies.

According to him, the increased availability of local expertise and equipment has created more competition, helping to reduce the cost of some oilfield services.

The development, he argued, has also helped reduce dependence on foreign service providers, creating opportunities to retain more industry spending within Nigeria and limit exposure to foreign exchange costs associated with imported services.

Ogunsanya maintained that indigenous companies could now provide competitive, high-quality services across several segments of the petroleum industry.

He also commended the NCDMB for its role in supporting the growth of Nigerian companies through local content policies and financing initiatives.

However, he acknowledged that sustaining this progress would require continued investment in modern equipment, technical development and improved access to capital.

Beyond equipment and financing, PETAN expressed concern about the increasing movement of experienced Nigerian oil and gas professionals to other petroleum-producing countries, particularly in the Middle East.

Ogunsanya identified Qatar, Saudi Arabia and Kuwait among countries attracting skilled Nigerian engineers and technical specialists.

He warned that the continued departure of experienced professionals could create a significant workforce gap at a time when indigenous companies are assuming greater responsibility for oil and gas operations.

According to him, international oil companies historically played an important role in training Nigerian professionals through specialised programmes, practical experience and overseas assignments.

However, the recent transfer of onshore and shallow-water assets from multinational companies to indigenous operators has raised questions about who will take responsibility for developing the next generation of petroleum professionals.

Ogunsanya maintained that Nigerian companies acquiring these assets must invest in training and capacity building rather than relying solely on professionals developed by international operators.

He warned that without deliberate investment in manpower development, indigenous operators risk losing some of the opportunities created by the Nigerian Oil and Gas Industry Content Development Act.

The PETAN chairman emphasised the need to train more young Nigerians in specialised areas, including drilling, pipeline installation, fabrication, welding and offshore operations.

He disclosed that PETAN recruits approximately 100 engineers every two years through its internship programme, with member companies employing more than 60 per cent of participants after completing their training.

The association is also working towards establishing a training centre in Port Harcourt, Rivers State, to provide practical technical education using industry equipment.

Ogunsanya maintained that expanding training opportunities within Nigeria would help reduce dependence on foreign technical expertise while ensuring that local companies have sufficient qualified personnel to sustain operations.

The association also called for a review of aspects of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act of 2010 to reflect changes in the ownership and operation of petroleum assets.

Ogunsanya acknowledged that the legislation had contributed significantly to indigenous participation in Nigeria’s petroleum industry, allowing local companies to compete for contracts and develop technical capabilities.

However, he maintained that the industry’s changing structure, particularly the growing acquisition of onshore and shallow-water assets by Nigerian companies, had created new challenges that required attention.

The PETAN chairman supported reviewing relevant provisions of the legislation to ensure that indigenous operators and service companies can respond effectively to emerging financing, equipment and workforce requirements.

The law, enacted in 2010, was designed to promote Nigerian participation in the petroleum industry by encouraging the use of local labour, expertise, equipment and services.

Its implementation has helped expand opportunities for Nigerian businesses, although industry stakeholders continue to debate how best to strengthen its effectiveness.

The recent divestment of petroleum assets by international companies has further increased the importance of ensuring that Nigerian-owned businesses possess the financial and technical capacity to manage their growing responsibilities.

PETAN maintained that indigenous ownership must be supported by access to equipment, competitive financing and continuous workforce development if the country is to maximise the benefits of local content policies.

Ogunsanya stressed that achieving the three-million-barrel production target would depend not only on Nigeria’s available oil reserves but also on its ability to finance oilfield operations, strengthen local service companies and develop the skilled workforce required to sustain higher production.

The association urged government agencies, regulators, financial institutions and industry operators to work together to address these constraints and improve the competitiveness of Nigeria’s indigenous petroleum industry.