Professor Wumi Iledare, Professor Emeritus of Petroleum Economics at Louisiana State University, has urged the Federal Government to place sustainable development at the heart of ongoing reforms in Nigeria’s oil and gas industry.
Speaking to journalists on Monday in Lagos, Professor Iledare called on President Bola Tinubu’s administration to uphold the provisions of the Petroleum Industry Act (PIA) 2021 and maintain policy stability in order to attract long-term investment.
He underscored the importance of improving transparency in oil transactions and refining processes, while also pushing for stronger investment in local talent and content development.
“There is a pressing need to invest in human capital, enhance local participation, and deepen public engagement to support the sector’s advancement,” Iledare said.
As the Tinubu administration marks its second year in office, Iledare acknowledged some progress in reforming the petroleum sector but warned that persistent structural challenges continue to hinder growth.
He observed that Nigeria’s crude oil output remains significantly below its 1.8 million barrels per day (bpd) production quota set by the Organisation of Petroleum Exporting Countries (OPEC), averaging between 1.2 and 1.4 million bpd. According to him, this shortfall is driven by issues such as oil theft, pipeline vandalism, low investment in upstream activities and the sluggish implementation of the PIA.
While commending efforts to expand domestic refining capacity, particularly the partial commencement of operations at the Dangote Refinery, Iledare stressed that Nigeria still relies heavily on imported refined petroleum products.
He attributed the situation to delays in rehabilitating government-owned refineries, regulatory uncertainty affecting modular refineries, and the absence of a transparent, reliable supply chain for petroleum distribution.
Professor Iledare also expressed concern over the handling of fuel subsidy reforms, stating that the removal of subsidies in 2023 led to higher inflation without sufficient protective mechanisms for low-income households.
He criticised the slow pace of institutional reform within the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), saying inefficiencies in these agencies continue to constrain sector performance.
He also pointed to the depreciating naira as a major factor driving up operational costs across the oil and gas value chain.
“A clear and coordinated roadmap for gas-to-power and clean energy development has yet to materialise,” Iledare remarked.
To improve oil production, he recommended better security collaboration with host communities, the resolution of funding delays in joint venture arrangements, and the introduction of fiscal incentives to stimulate new investment.
He also advocated for the full commissioning of the Dangote Refinery, a transparent supply and distribution framework, speedy rehabilitation of government-owned refineries, and clear regulatory guidelines for private-sector refining initiatives.
While acknowledging the administration’s ongoing reform agenda, Iledare warned that without addressing underlying systemic problems, the impact of such initiatives may be limited.
He concluded that with bold, coordinated policy actions, Nigeria’s oil and gas industry has the potential to serve as a cornerstone for broad-based economic growth.