Communiqué Issued Following the Policy Dialogue on “The Role of NNPC in Nigeria’s Energy Transition” Held at Abuja Continental Hotel, Abuja, on Thursday, 8 October 2026

Background  

On 8 October 2026, the Natural Resource Governance Institute (NRGI), in collaboration with the Centre for Petroleum, Energy Economics and Law (CPEEL) at the University of Ibadan, the Centre for Energy, Finance and Development (CEFD), and the Inclusive and Sustainable Development Research Centre (ISDRC), convened a policy dialogue on “The Role of NNPC in Nigeria’s Energy Transition” in Abuja.

The dialogue examined a fundamental policy challenge facing Nigeria. NNPC Limited is expected to support increased petroleum production, strengthen domestic energy security and contribute to government revenues, as a commercially oriented company under the Petroleum Industry Act, while responding to Nigeria’s energy transition commitments. These expectations create difficult investment, governance and policy choices at a time of increasing uncertainty in global energy markets.

The dialogue followed a technical workshop held on 29 September 2026 with NNPC’s Governance, Risk and Compliance and Sustainability teams, during which the research partners presented preliminary findings and received institutional feedback. NNPC representatives acknowledged the difficulty of reconciling petroleum expansion objectives, commercial obligations, national energy security and transition commitments, while engaging constructively with the strategic options presented.

The subsequent dialogue brought together representatives of NNPC Limited, the Nigerian Upstream Petroleum Regulatory Commission, the National Council on Climate Change, the Rural Electrification Agency, the Presidential Task Force on Power Sector Reset and Restoration, research institutions, civil society organizations and other stakeholders.

Objective  

The dialogue sought to advance an evidence-based assessment of NNPC’s role in Nigeria’s energy transition and identify practical institutional, investment and policy measures that could support commercially credible decisions consistent with national development priorities.

Specifically, it examined the implications of alternative investment strategies for NNPC and the wider economy, the viability of existing oil and gas ambitions under changing market conditions, opportunities for diversification, and the governance and institutional reforms required to reconcile the company’s commercial mandate with wider public policy objectives.

The engagement was designed to inform the finalization of collaborative research by CPEEL, CEFD and ISDRC and provide a basis for further institutional consideration of the findings and dissemination of NRGI’s relevant evidence-based research.

Key Issues from the Deliberations

Following the research presentations and discussions, the following issues emerged as priorities for further institutional consideration.  

1. NNPC’s commercial mandate and national policy expectations require clearer alignment 

The dialogue highlighted the difficulty of reconciling government expectations for increased petroleum production with NNPC’s commercial responsibilities and Nigeria’s energy transition commitments. Participants recognized that these objectives cannot be addressed through NNPC’s investment decisions alone. Clearer government policy direction, coordination across responsible institutions and explicit treatment of the costs of public policy obligations are necessary to reduce conflicting expectations and improve strategic decision-making.  

2. Nigeria’s petroleum production ambitions must be tested against changing market conditions  

Nigeria’s objectives to expand oil and gas production must be assessed alongside uncertainty in future demand, prices, access to finance and international climate policies. Investment decisions based principally on production targets may expose NNPC and the wider economy to financial risks if underlying market assumptions do not materialize. The research highlighted the importance of regular portfolio reviews, scenario analysis and commercial evaluation of major capital commitments.  

3. Gas investments require more rigorous assessment of domestic demand and delivery prospects  

Natural gas remains important to Nigeria’s power generation, industrial development and energy security objectives. However, discussions raised concerns about the gap between ambitious gas development plans and the historical performance of gas-to-power investments. Future gas projects should therefore be assessed against realistic domestic demand, infrastructure constraints, financing conditions, implementation capacity and alternative energy supply options. Gas investment priorities should reflect demonstrable economic and energy access benefits rather than production expansion alone. Alternative energy sources should be considered where gas cannot provide reliable and affordable access to electricity.  

4. Energy diversification should be selective, commercially viable and consistent with NNPC’s capabilities  

The dialogue recognized potential opportunities for NNPC in renewable energy, lower-carbon activities and emerging energy markets. However, diversification does not automatically create value or reduce transition risks. New investments should be assessed against commercial viability, institutional capabilities, potential partnerships and the availability of finance. Targeted partnerships and pilot investments may provide more appropriate entry points where commercial opportunities remain uncertain.  

5. NNPC’s strategic choices have wider implications for Nigeria’s economy and public finances  

NRGI’s transformation strategic choices report formed the basis for reflections on strategic choices for Nigeria aligned with development and climate objectives; partial or deep diversification or full industrial diversification. The economic modelling reinforced the importance of examining the national consequences of alternative investment pathways. Decisions affecting petroleum production, capital allocation and diversification may influence government revenues, employment, investment and economic growth. These implications require coordinated assessment by NNPC and the institutions responsible for fiscal policy, economic planning and national development.  

6. Public policy obligations must be distinguished from commercial investment decisions  

The dialogue highlighted the importance of distinguishing activities undertaken by NNPC on commercial grounds from those pursued in support of government policy objectives. As a commercial entity reformed under the Petroleum Industry Act (PIA), NNPC would benefit from clear criteria, appropriate safeguards, and transparent costing when undertaking activities outside its core commercial mandate. This is particularly relevant for major financial commitments, including securitization arrangements and refinery investments, where commercial viability, affordability, and operational capacity require careful consideration.. Participants emphasized that  strong commercial discipline and effective governance are required to balance these priorities,  

7. Governance, transparency and institutional coordination are central to credible transition planning  

NNPC’s evolving role will depend on decisions made across institutions responsible for petroleum development, climate policy, electricity, public finance and national planning. Fragmented objectives and unclear responsibilities can weaken implementation. Participants highlighted the value of stronger coordination, transparent investment assumptions, credible oversight and mechanisms for reviewing strategic decisions as market and policy conditions change.  

8. The research process demonstrated the value of direct institutional engagement  

The technical consultation and policy dialogue provided opportunities for independent researchers and NNPC representatives to examine areas of convergence and disagreement. NNPC’s constructive engagement with the findings, including its recognition of the difficult balance between commercial obligations, petroleum expansion and transition objectives, reinforced the practical relevance of the research. The engagement also identified opportunities for further analysis and institutional discussion, without presuming that NNPC has formally adopted the research recommendations.   

9. Clarity in objectives translates to clarity in messaging

Just transition principles and priorities should be aligned in how NNPC communicates within its borders and the larger international community. Insights from NRGI’s narrative study on the role of NNPC reveal that while NNPC and Nigerians are aligned on themes: energy access, just transition, economic prosperity, and Nigerians' concerns; access to jobs, minimization of environmental harm, etc., more needs to be done to clarify NNPC’s position and provide greater alignment with its commercial objectives under the PIA.  

Priority Recommendations Ahead of the 2027 Elections and for NNPC Institutional Consideration  

Drawing on the research and issues raised during the dialogue, the following actions are proposed to strengthen NNPC’s strategic planning and Nigeria’s wider energy transition governance.  

1. Clarify NNPC’s role within Nigeria’s national energy transition strategy.  

The Federal Ministry of Finance, the Federal Ministry of Budget and National Planning, working with NNPC Limited and the National Council on Climate Change, should establish clearer expectations for NNPC’s contribution to energy development, domestic energy security, emissions reduction and economic diversification aligned with development objectives and climate commitments. This clarity would help ensure that NNPC’s contribution remains grounded in its commercial objectives, while supporting broader government priorities only where these are appropriately aligned.

2. Undertake a structured review of NNPC’s major investment portfolio 

NNPC Limited should consider a systematic assessment of its existing and proposed oil and gas investments against alternative global demand, price, financing and transition scenarios. The review should identify projects that remain commercially resilient, those requiring reconsideration and areas where capital allocation could be improved. Findings should inform future investment prioritization and risk management.  

3. Assess transition risks - subject major gas investments to realistic demand and commercial stress tests  

NNPC Limited, in coordination with relevant petroleum and electricity sector institutions, should strengthen the assessment of proposed gas projects against credible domestic and export demand, infrastructure readiness, financing requirements and alternative energy supply scenarios. Particular attention should be given to whether investments can deliver affordable domestic energy and sustainable commercial returns under less favourable market conditions.  

4. Develop a selective and commercially grounded diversification approach  

NNPC Limited, including its emerging energy businesses, should assess opportunities in renewable energy and other lower-carbon activities based on commercial viability, strategic relevance and institutional capabilities. Where opportunities are promising but uncertain, partnerships and pilot investments should be considered before major capital commitments. Clear performance criteria should guide decisions on whether to expand, modify or discontinue such activities.  

5. Establish transparent arrangements for government-directed investments

The Federal Ministry of Petroleum Resources, the Federal Ministry of Finance and NNPC Limited should clarify the mandates, financing responsibilities and accountability arrangements for investments undertaken primarily to achieve public policy objectives. Where such activities impose costs or risks on NNPC, these should be explicitly assessed and appropriately reflected in government and corporate decision-making.  

6. Integrate the economy-wide implications of NNPC’s strategy into national planning  

The Federal Ministry of Budget and Economic Planning, the Federal Ministry of Finance and relevant energy institutions should consider the fiscal, employment, investment and economic growth implications of alternative NNPC investment pathways. This would support better coordination between national energy policy, public financial management and economic diversification planning.  

7. Strengthen disclosure and accountability around major strategic investments  

NNPC Limited and relevant oversight institutions should consider improved public disclosure of the strategic rationale, material assumptions, financing arrangements and expected public benefits of major investments, subject to legitimate commercial confidentiality requirements. Clearer reporting on investment performance and transition-related risks would support informed oversight and public accountability.  

8. Establish a structured mechanism for continued technical engagement  

NRGI, CPEEL, CEFD and ISDRC should seek further engagement with NNPC Limited and relevant government institutions to present the final research findings, consider institutional feedback and identify areas where additional analysis could inform strategic planning. Priority areas could include portfolio risk assessment, gas investment evaluation, public policy mandates and governance arrangements.