There is a phrase that keeps appearing in conversations about AI, cloud computing and digital infrastructure:
“Compute is the new oil.”
But what exactly does that mean?
If you are not deeply involved in technology, “compute power” can sound like another complicated tech buzzword.
It really isn't.
So, What Is Compute Power?
In simple terms, compute power is the amount of computing capacity available to process tasks.
Every time you:
Generate an AI image Ask ChatGPT a question Train an AI model Analyse millions of records Stream a video Run a large website Process a bank transaction Simulate a scientific problem
Computers somewhere are doing the work.
That work requires processors, memory, storage, networking, electricity and cooling.
For ordinary applications, a regular computer may provide enough computing power.
But modern AI is different.
Training and running large AI models can require thousands of specialised processors, particularly GPUs, operating inside data centres.
So when people talk about a country's compute capacity, they are essentially talking about how much computing infrastructure that country can access and operate.
Why Compare Compute to Oil?
The comparison is a metaphor, not a literal equivalence.
Oil powered much of the industrial economy because it was an essential input for transportation, manufacturing and energy.
Compute is becoming an increasingly important input for the digital economy.
AI companies need it.
Banks need it.
Cloud providers need it.
Research institutions need it.
Healthcare applications need it.
Governments need it.
Businesses building AI-powered products need it.
The more computationally demanding technology becomes, the more access to reliable compute matters.
The World Economic Forum recently described the AI infrastructure race as increasingly becoming a competition for access to electricity and data-centre capacity.
NVIDIA has also described compute infrastructure as productive infrastructure that can generate revenue as organisations use it to build and operate AI applications.
Why Should Nigeria Care?
This is where the conversation becomes particularly important.
Nigeria can have brilliant AI researchers and software developers, but if they have to rely entirely on expensive or distant foreign infrastructure to train and run their systems, there is still an infrastructure gap.
Nigeria's own National AI Strategy identified the need for affordable, localised AI infrastructure and compute capacity.
The strategy specifically proposes high-performance computing resources that researchers, startups and businesses can access, while also seeking to reduce dependence on foreign technology.
The Federal Government has also moved further in this direction.
Its National Digital Cloud Policy, unveiled in August 2026, explicitly identifies AI compute capacity as part of the infrastructure Nigeria needs to attract investment and develop its digital economy.
Nigeria Has Already Started Thinking About Compute
This isn't a completely new conversation.
In 2024, the Federal Government announced a computing infrastructure pilot involving Galaxy Backbone and 21st Century Technologies, with the stated aim of making compute available to Nigerian researchers, startups and government entities working on AI projects of national interest.
The same announcement discussed a pilot investment of more than $2 million in GPUs.
That tells us something important:
Compute is becoming infrastructure.
Just like roads, electricity and telecommunications infrastructure affect what businesses can build, computing infrastructure increasingly affects what digital businesses and researchers can develop.
But Compute Isn't Just About Having GPUs
This is another important point.
You cannot simply buy a warehouse full of GPUs and declare that you have solved the problem.
AI infrastructure also requires:
Electricity.
Cooling.
Data centres.
High-speed networks.
Storage.
Cybersecurity.
Skilled engineers.
Cloud platforms.
Maintenance.
The World Economic Forum notes that AI data centres have significant power and cooling requirements.
So the compute conversation is actually a conversation about an entire infrastructure ecosystem.
What Happens If Nigeria Doesn't Build Enough?
Nigerian companies can still use foreign cloud platforms, of course.
Cloud computing has made it possible for startups to rent computing resources without owning their own data centres.
But relying heavily on infrastructure located elsewhere can create questions around cost, availability, strategic control, data governance and long-term digital sovereignty.
This is part of why NITDA has described computing power and digital infrastructure as important to Nigeria's ability to determine its own digital future.
It is also why the Federal Government's current cloud policy focuses on attracting investment into Nigerian cloud and data-centre infrastructure rather than simply telling organisations to stop using foreign technology.
And There Is a Human Side to Compute
Infrastructure without people doesn't accomplish much.
Nigeria needs people who can actually build and operate what sits on top of that infrastructure.
That means:
AI engineers Cloud engineers Data scientists Software developers Cybersecurity professionals DevOps engineers Data-centre specialists Machine-learning researchers
This is where technology education becomes important.
At organisations such as TEKHUB, practical technology education can help develop some of the technical skills required to participate in this growing digital infrastructure ecosystem. You can explore more at www.tekhub.ng.
So, Is Compute Really the “New Oil”?
It is better understood as a metaphor for strategic importance.
Compute isn't a natural resource that Nigeria can simply extract from the ground.
But access to computing capacity can increasingly determine who can develop AI, run large digital services, conduct advanced research and compete in the technology economy.
And that leads to a much more useful question than whether compute is literally the new oil:
Can Nigeria build enough of the computing infrastructure it will need to become a producer of AI and digital technology rather than primarily a consumer?
That is where the real conversation begins.
