Discovery & Early Exploration
The story of oil in Nigeria begins long before the first commercial well. Early geological surveys, colonial-era concessions, and the determination of pioneer explorers set the stage for what would become Africa's most important oil-producing nation.
Early Signs of Oil
Oil seepages had been observed in southern Nigeria for centuries. Local communities in the Niger Delta used natural bitumen and oil seeps for medicinal and waterproofing purposes long before European explorers arrived. In the early 20th century, the British colonial administration began to recognise the potential of these deposits.
Nigerian Bitumen Corporation
The Nigerian Bitumen Corporation conducted the first formal exploration for oil in the Araromi area of present-day Ondo State. Operations were suspended during World War I.
Shell D'Arcy Exploration
Shell D'Arcy (later Shell-BP) was granted an exploration licence covering the entire territory of Nigeria.[1] This was the beginning of systematic, large-scale oil exploration.
Interrupted by War
Shell D'Arcy began drilling in 1938 in the Owerri province, but World War II halted exploration. Work resumed in 1946 with improved technology and renewed investment.
Oloibiri Discovery
Shell-BP struck oil in commercial quantities at Oloibiri, Bayelsa State on 15 January.[2] The Oloibiri-1 well produced about 5,100 bpd at peak - the moment that changed Nigeria's destiny.
First Oil Export
Nigeria exported its first cargo of crude oil - 8,500 tonnes from the Oloibiri field, shipped to Rotterdam in the Netherlands.[3] Production averaged about 5,100 bpd.
The Oloibiri Discovery (1956)
After nearly two decades of systematic exploration and numerous dry holes, Shell-BP struck oil in commercial quantities at Oloibiri in the present-day Bayelsa State on 15 January 1956. This discovery changed Nigeria's destiny forever.
First Oil Export
In February 1958, Nigeria exported its first cargo of crude oil - 8,500 tonnes from the Oloibiri field, shipped to Rotterdam in the Netherlands. Production was modest initially, averaging about 5,100 barrels per day, but it marked the beginning of Nigeria's transformation from an agricultural economy to a petroleum-dependent one.
Expanding Exploration (1958–1970)
Following the Oloibiri success, exploration accelerated rapidly:
New Companies Enter
- • Mobil (1955) - offshore exploration pioneer
- • Gulf Oil (1961) - later became Chevron
- • Agip (1962) - Italian national oil company
- • Elf/Total (1962) - French operator
- • Phillips (1965) - later ConocoPhillips
Production Growth
- • 1958: ~5,000 barrels per day
- • 1960: ~17,000 bpd (at independence)
- • 1965: ~275,000 bpd
- • 1966: Disrupted by civil war
- • 1970: ~1 million bpd post-war recovery
Early Oil Companies in Nigeria
| Company | Year of Entry | Origin | Key Contribution |
|---|---|---|---|
| Shell-BP | 1937 | UK / Netherlands | First commercial discovery at Oloibiri; pioneer operator |
| Mobil | 1955 | United States | Offshore exploration pioneer; Qua Iboe terminal |
| Gulf Oil | 1961 | United States | Later became Chevron; major Niger Delta presence |
| Agip | 1962 | Italy | Italian national oil company; onshore operations |
| Elf/Total | 1962 | France | French operator; offshore and onshore acreage |
| Phillips | 1965 | United States | Later ConocoPhillips; exploration in the eastern Delta |
Sources
- Shell Petroleum Development Company, "Shell in Nigeria - History".
- NNPC, "History of the Nigerian Petroleum Industry".
- Steyn, P., "Oil Exploration in Colonial Nigeria, c. 1903-58", Journal of Imperial and Commonwealth History, 2009.