Sierra Leone has taken a major step to revive its oil and gas sector, signing a $225 million offshore exploration agreement with Nigerian indigenous company Marginal Energy Limited.
The deal was concluded on the sidelines of the Invest in African Energy Conference in Paris, granting the Nigerian firm rights to explore and potentially develop five offshore blocks—G-145, G-146, G-147, G-160, and G-161.
Covering an estimated 6,800 square kilometres, the agreement is seen as a renewed push by the Petroleum Directorate of Sierra Leone to unlock the country’s upstream petroleum potential, which has remained largely dormant after earlier exploration efforts failed to yield commercially viable discoveries.
Industry observers say the partnership reflects a growing trend of African-led investment in the continent’s extractive industries. Sierra Leone’s offshore resources have traditionally been dominated by Western oil majors, but the entry of a Nigerian firm signals increasing technical capacity and confidence among indigenous companies.
Under the agreement, the $225 million investment will fund seismic surveys and drilling operations, critical steps in determining whether the offshore blocks hold commercially viable reserves. Despite the optimism, the acreage is still considered high-risk, often described in the industry as “frontier” territory.
The deal also introduces a State Participation Model designed to safeguard national interests. Sierra Leone will hold a 10 percent carried interest in oil and 5 percent in gas during the exploration phase, allowing the government to benefit without upfront financial commitments. There is also an option for the state to increase its stake by an additional 9 percent if production begins.
Officials say the agreement is not only about discovering oil but also about building local expertise by leveraging Nigerian experience. The collaboration is expected to help Sierra Leone move closer to turning its long-standing geological potential into tangible economic gains.
