NIGERIA has formally closed one of the most contentious chapters in its oil and gas history, signing a settlement agreement with Italian energy giant Eni and its subsidiary Nigerian Agip Exploration Limited (NAEL) to resolve a dispute over offshore block OPL 245 that has shadowed the country’s investment reputation for more than two decades.
Attorney-General and Minister of Justice Lateef Fagbemi confirmed the conclusion of the deal at a ceremony in Abuja on 25 February, describing it as “a turning point for Nigeria’s oil and gas sector after more than two decades of legal battles and international arbitration.” The settlement will culminate in a Consent Arbitral Award, extinguishing outstanding claims on both sides.
“This settlement sends a clear signal to the global community that Nigeria is open for business and committed to fairness and respect for contractual obligations.”
Lateef Fagbemi, Attorney-General of the Federation
What Is OPL 245?
Offshore Petroleum Licence 245 sits in the deep waters of the Niger Delta and is widely regarded as one of the most valuable undeveloped oil blocks on the African continent. The block has been the subject of overlapping legal disputes, international arbitration proceedings and criminal prosecutions in Italy — where Eni executives faced trial over a separate $1.1 billion deal involving the block — since the early 2000s. Nigeria’s government has long argued it was owed greater value and development certainty from the asset.
Fiscal and Economic Implications
For Abuja’s budget architects, the resolution unlocks a significant planning variable. Fagbemi said projected revenues from OPL 245 can now be incorporated into Nigeria’s medium-term fiscal framework, supporting budget stability, long-term economic planning and debt sustainability metrics that have come under pressure as the country navigates currency volatility and a post-subsidy fiscal adjustment.
The removal of legal and fiscal uncertainty over the block is also expected to enable large-scale upstream investment. Analysts have pointed to OPL 245 as a stranded asset whose development potential has been frozen by litigation — a factor that has suppressed Nigeria’s oil production trajectory at a time when the country is struggling to consistently meet its OPEC+ quota.
“This development will pave the way for large-scale investments, stimulate job creation, and reinforce Nigeria’s position as a leading energy producer in Africa,” Fagbemi said.
“Nigeria can now move forward with confidence, ensuring that the development of OPL 245 becomes a source of prosperity for the nation and future generations.”
Lateef Fagbemi, Attorney-General
A Signal on Dispute Resolution
Beyond the immediate economic calculus, officials are framing the settlement as a demonstration of Nigeria’s commitment to international commercial norms. Fagbemi said the choice to resolve the dispute through negotiated settlement rather than prolonged arbitration underscores the country’s credibility in international commercial and arbitration circles — a posture that matters as African governments compete to attract foreign direct investment in energy transition infrastructure alongside conventional hydrocarbons.
The signing ceremony was attended by Eni Chief Executive Claudio Descalzi, Fagbemi and Minister of State for Petroleum Heineken Lokpobiri. The Attorney-General also credited the Ministry of Petroleum Resources, the Nigerian Upstream Petroleum Regulatory Commission, the Nigerian National Petroleum Company Limited and the Economic and Financial Crimes Commission with contributing to the resolution.
What Comes Next
The formalisation of the Consent Arbitral Award will be the next procedural milestone, converting the political agreement into a binding legal instrument. Development timelines for OPL 245 have not been publicly disclosed. Nigeria’s upstream regulator and Eni are expected to negotiate a revised work programme for the block, with energy analysts closely watching whether the settlement accelerates activity in Nigeria’s deep-water frontier.
For a country that lost an estimated $6 billion in annual oil revenue to production shortfalls in 2023 alone, according to figures from the Nigerian Extractive Industries Transparency Initiative, unlocking OPL 245’s development potential represents a material fiscal opportunity — one that officials now say is, at last, within reach.
