Sierra Leone has signed a petroleum licence agreement with Nigeria-based Marginal Energy Limited, granting the firm offshore exploration and production rights as part of efforts to revitalise its underdeveloped upstream sector.
The agreement, executed through the Petroleum Directorate of Sierra Leone, covers offshore blocks G-145, G-146, G-147, G-160 and G-161. These blocks span approximately 6,800 square kilometres within the country’s largely untapped offshore basin.
Under the deal, Marginal Energy has committed to an extensive exploration programme that includes seismic surveys and drilling activities, with total investment expected to exceed US $225m. The initiative is aimed at generating new geological data and identifying commercially viable hydrocarbon reserves.
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Economic benefits
Sierra Leone will maintain a 10% carried interest in oil projects and 5% in gas during the exploration and development phases, meaning the government will not fund initial costs. It also retains the option to increase its stake by up to an additional 9% on a paid basis once production begins.
The agreement was signed during the Invest in African Energy Conference in Paris, where the government has been actively promoting its offshore opportunities to global investors. President Julius Maada Bio said the deal demonstrates the country’s commitment to unlocking its petroleum resources while ensuring economic benefits for its citizens.
Sierra Leone is also preparing to launch a new offshore licensing round, supported by updated seismic data, in a bid to attract further investment into its frontier basin. Although the country has long sought to become an oil producer following early exploration efforts in the 1980s progress has been limited. However, renewed regulatory reforms and improved data availability are now helping to reposition the nation as an emerging destination for oil and gas exploration.
Recent developments suggest growing investor interest. Shell signed an offshore exploration agreement with Sierra Leone in April 2026, following a similar move by Eni just months earlier. The deal also highlights a broader trend of Nigerian energy firms expanding across Africa.
Companies like Oando are increasing their regional footprint, with operations in countries such as Angola and expansion plans targeting Ghana and Côte d’Ivoire. This regional momentum extends beyond upstream exploration. Industrialist Aliko Dangote recently announced plans to build a refinery in Tanzania similar to his flagship facility in Lagos, signalling continued investment in Africa’s energy value chain.
