INTERNATIONAL JOURNAL OF ACCOUNTING, FINANCE AND MANAGEMENT (IJAFM)
NEXUS BETWEEN FIRM CHARACTERISTICS AND CAPITAL STRUCTURE OF LISTED OIL AND GAS COMPANIES IN NIGERIA
E-ISSN: 5669-4522
P-ISSN: 2567-3562
DOI: https://iigdpublishers.com/article/1652
Capital structure decisions determine how capital-intensive and price-exposed firms fund investment, yet evidence on Nigerian oil and gas companies remained dated and inconsistent. This study examined the effect of firm characteristics on the capital structure of listed oil and gas firms in Nigeria. An ex post facto panel research design was adopted. The scope covered eight firms listed on the Nigerian Exchange over 2016–2025, giving 80 firm-year observations. Data were obtained from audited annual reports, with Brent price from the U.S. Energy Information Administration and exchange-rate and inflation series from the Central Bank of Nigeria. Total debt to total assets was the dependent variable. Data were analysed using descriptive statistics, pooled, fixed-effects and random-effects estimators, model-selection and residual diagnostics, and robustness checks with wild cluster bootstrap and Driscoll–Kraay standard errors. Pooled OLS was preferred. Profitability (β = −1.566, p < 0.05), liquidity (β = −0.140, p < 0.05) and non-debt tax shields (β = −3.792, p < 0.05) reduced leverage, while firm size (β = 0.038, p < 0.05), tangibility (β = 0.434, p < 0.05) and growth opportunities (β = 0.396, p < 0.05) increased it. Sub-sector had no significant effect (β = 0.006, p > 0.05). The findings supported pecking-order and trade-off behaviour. The managers should use retained earnings and keep liquidity, lenders should match credit with collateral and size, and the policy makers should bring the depreciation related tax incentives into alignment.
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