ExxonMobil’s $1.5B Deepwater Push Marks Strategic Confidence in Nigeria’s Oil Recovery

ExxonMobil has committed $1.5 billion to reviving production at the Usan oilfield in Nigeria’s offshore block OML 138—a move that signals renewed confidence in the country’s oil sector and its regulatory direction. The investment is one of the clearest signs yet that Nigeria’s “Project 1 Million Barrels” initiative is beginning to attract the scale of capital required to meet its 2027 target of 2.4 million barrels per day.

The Usan field, discovered in 2002 and operational since 2012, consists of 34 subsea wells and eight manifolds. According to ExxonMobil, the planned work program will run from Q2 2025 through 2027, with a final investment decision expected by Q3 2025. The company is currently pursuing internal approvals and exploring funding partnerships to move the project forward.

A Calculated Bet on Deepwater

This investment is more than a production boost—it reflects a strategic shift. ExxonMobil, like several major oil producers, is moving away from onshore assets in Nigeria due to persistent challenges ranging from insecurity to operational inefficiencies. Its $1.28 billion divestment of onshore operations to Seplat Energy, completed in 2024, cleared the path for a concentrated focus on deepwater exploration.

Usan is one piece of a broader portfolio. ExxonMobil’s Nigeria chief, Shane Harris, confirmed that similar development efforts are being planned for the Owowo and Erha fields. These fields fall under the company’s five deepwater licenses operated through its Esso subsidiaries.

For ExxonMobil, the economics of deepwater are increasingly compelling: higher margins, fewer disruptions, and more favorable long-term returns—especially when backed by supportive policy frameworks like those now taking shape in Nigeria.

What It Means for Nigeria’s Oil Future

From a policy perspective, the investment is a win. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has been actively courting capital under its “Project 1 Million Barrels” agenda. The commission’s chief, Gbenga Komolafe, welcomed the announcement as a clear signal that Nigeria is regaining its footing in the global energy space.

But the stakes go beyond one company. Nigeria needs more than incremental gains—it requires transformational investment across its energy value chain. ExxonMobil’s $1.5 billion commitment could set a precedent, but much depends on execution, transparency, and regulatory consistency.

ExxonMobil’s latest move is not just about increasing output—it’s a bet on Nigeria’s ability to reset its oil narrative. If the Usan project progresses as planned, it may do more than add barrels; it could help restore Nigeria’s credibility as a serious player in the global energy market.