The gas pipeline project linking Nigeria to Morocco, known as the Africa-Atlantic Pipeline, continues to attract strategic interest while remaining exposed to significant financial and operational uncertainties. This is the conclusion drawn by economist Wumi Iledare, a distinguished professor of petroleum economics and a specialist in energy public policies, following his analysis of the Nigerian energy sector’s performance in 2025 and the expected outlook for 2026.
Speaking in Lagos, the expert believes that despite positive signals recorded in the Nigerian gas segment, major structural projects remain vulnerable. “The progress observed in increasing reserves, reducing flaring, and improving domestic supply is not enough to alleviate the risks surrounding megaprojects,” he emphasizes, citing the Nigeria-Morocco pipeline alongside the Ajaokuta-Kaduna-Kano (AKK) project.
According to him, the feasibility of the Africa-Atlantic Pipeline is closely tied to the robustness of financial arrangements, the continuity of public governance, and the capacity of Nigerian authorities to ensure a stable institutional framework over the long term.
A Still Fragile Oil Recovery
On the oil front, the year 2025 marks a measurable recovery after several years of contraction. Wumi Iledare attributes this improvement to a relative security calm, the gradual implementation of the Petroleum Industry Act (PIA), and better operational discipline.
Crude oil production is estimated to have reached an average of 1.6 to 1.7 million barrels per day, a level described as “significant” by the economist. However, he tempers official rhetoric regarding strict compliance with OPEC+ quotas, noting that production has remained below targets and that oil revenues have disappointed compared to budget projections, particularly in the first half of the year.
“The trajectory is positive, but it cannot be equated with a structural transformation,” he warns, highlighting the still uneven and insecure nature of the recorded progress.
Governance, Downstream, and Unfinished Reforms
As the executive director of the Emmanuel Egbogah Foundation, Wumi Iledare acknowledges progress in the fight against crude oil theft and vandalism, linked to increased surveillance and strengthened cooperation with local communities. Nonetheless, he calls for caution regarding publicly announced figures, believing that the absence of independent oversight limits the credibility of some claims.
In the upstream oil sector, the resurgence in the number of drilling rigs is also downplayed, with the expert reminding that this increase is partly due to a base effect from the historical low of 2021. Not all listed equipment is necessarily operational, and their actual contribution will depend on access to financing, evacuation capabilities, and contractual stability.
He asserts that the downstream sector remains the most sensitive segment. He warns against simplistic interpretations pitting investors against importers, reminding that competition primarily depends on market structure and regulator neutrality. In this regard, he advises caution in evaluating the performance of the Dangote refinery, whose announced results still largely appear to be projections.
An Institutional Test for 2026
Addressing the asset divestment plans of the Nigerian National Petroleum Company Ltd. (NNPCL), the economist views this more as a portfolio adjustment than a strategic disengagement. However, he warns about the risks of short-term budgetary use of the proceeds from these divestments, in the absence of rigorous governance and transparency.
For Wumi Iledare, the persistent gap between the recovery of production and budget performance is one of the most telling signs of unfinished reform. Price volatility, cost structures, and governance flaws continue to limit the oil sector’s impact on public finances.
In this context, the Nigeria-Morocco pipeline emerges as a project with high geoeconomic potential, but still dependent on the institutional robustness of the Nigerian energy sector. “The gains of 2025 exist, but they remain fragile. The challenge of 2026 will be one of rigor, discipline, and institutional endurance,” concludes the economist.
