The Nigerian National Petroleum Company (NNPC) is in talks to secure about $2 billion in financing to repair and upgrade pipelines damaged by years of theft and vandalism, as part of a broader effort to revive the country’s struggling petroleum sector.
People familiar with the matter told Reuters on Monday that NNPC is negotiating the facility with Nexus Alliance, a firm that specialises in pipeline infrastructure support. The funds are expected to be received in early 2025 and would be deployed to rehabilitate critical pipeline assets that have severely constrained Nigeria’s oil and gas output.
The proposed deal would provide much-needed capital to address infrastructure decay that has cost Africa’s largest oil producer billions of dollars in lost production and environmental damage over the past decade. Chronic pipeline breaches and leaks have repeatedly disrupted crude evacuation and export operations.
NNPC and Nexus Alliance did not immediately respond to requests for comment.
The pipeline talks form part of a wider refinancing and capital-raising drive by NNPC, which has engaged several international lenders in recent months. The company has also held discussions with Saudi Arabia-based financial institutions as it seeks to restructure its balance sheet and fund operational improvements, the sources said.
Beyond the immediate pipeline project, NNPC has set an ambitious target of attracting $30 billion in investment by 2027, with roughly half of that expected to be secured by 2026. The planned capital injection is intended to support efforts to raise oil production to at least 1.8 million barrels per day while expanding gas output.
Nigeria’s crude production has remained below its OPEC quota for years, weighed down by ageing infrastructure, insecurity in the Niger Delta and prolonged underinvestment. Output has hovered around 1.5 million barrels per day in recent months, well below historical peaks.
Pipeline rehabilitation addresses one of the sector’s most persistent challenges. Industry executives estimate that theft and sabotage account for losses of more than 200,000 barrels per day, translating into hundreds of millions of dollars in foregone revenue annually and significant environmental harm.
NNPC is also positioning itself for a long-anticipated initial public offering, which it views as a route to fresh capital and improved corporate governance. Progress towards a listing has been slow, with company officials acknowledging the need for greater transparency and stronger financial accountability.
These efforts are unfolding against the backdrop of sweeping economic reforms under President Bola Tinubu, including fuel subsidy removal and currency devaluation, measures aimed at stabilising public finances and attracting foreign investment despite near-term social costs.
NNPC has pledged to streamline operations, improve financial disclosures and reduce long-standing opacity, while working with external advisers on restructuring initiatives. Critics, however, continue to question the company’s dual role as both commercial operator and sector regulator, arguing that clearer separation would improve efficiency and accountability.
For Nexus Alliance, the prospective $2 billion deal would mark a significant investment in African energy infrastructure. While the firm has built a reputation for pipeline projects in emerging markets, details of its ownership and financial backing remain limited.
Analysts note that while the financing would be substantial, it represents only a fraction of the investment required to fully modernise Nigeria’s oil infrastructure. Sustained recovery will depend on improved security in oil-producing regions, effective anti-theft measures and consistent regulatory reforms—areas where past efforts have delivered mixed results.
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