Tokenization Brings New Investment Models to Oil and Gas Industry
- Tokenization allows fractional ownership of large oil and gas assets.
- It improves liquidity, lowers investment barriers and increases transaction transparency.
- Regulatory uncertainty and market volatility remain key adoption challenges ahead.
September 25, 2025 | Oil and Gas 3 minutes read
The oil and gas sector has historically been shaped by large-scale infrastructure and high capital requirements. Now, it’s beginning to experiment with a new financial model: tokenization.
By using blockchain to divide ownership of assets like oil fields, pipelines and terminals into digital shares, tokenization has opened up new ways to invest in this $5-trillion industry.
The approach could make transactions faster and more transparent while lowering barriers for smaller investors. Tokenization also links energy markets with emerging blockchain-based financial systems.
With the oil & gas industry still expected to supply more than half of the world’s energy needs in 2025, tokenization may offer a timely opportunity to rethink how capital flows into the sector.
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What Tokenization Means in Practice
Tokenization refers to the process of turning physical or financial assets into digital units on a blockchain. In the oil and gas industry, this could mean splitting a $100-million oil well into one million digital tokens, each priced at $100.
These tokens can be traded on blockchain-based platforms, bypassing traditional financial intermediaries.
Investors gain exposure to high-value energy assets without needing millions in upfront capital.
In 2023, tokenized assets worldwide totaled $2.3 billion, with oil and gas accounting for 18% of the market. It was second only to real estate.
As digital platforms improve and more projects are piloted, tokenization’s share in energy investments could rise, particularly for large, capital-heavy assets.
Unlocking Liquidity in a Capital-Intensive Sector
One of tokenization’s practical benefits is improved liquidity.
Assets such as offshore drilling rigs and pipelines are expensive and usually held for the long term. Tokenization allows partial ownership to be sold more easily, creating the option for earlier exits.
Blockchain’s public ledger also ensures that every transaction is recorded, helping build trust and reduce information asymmetry, thus tackling issues that have traditionally limited broader investment in the sector.
Expanding Access to Energy Investment
For decades, investment in the oil and gas industry was largely limited to corporations and institutional players. Tokenization could open the door to a wider pool of investors by reducing minimum investment sizes.
Some platforms already allow entry points as low as $50. Since 2023, retail investor participation in tokenized U.S. shale assets has grown steadily, with over 10,000 individuals joining in and user registration rising 30% annually.
Broader access could help direct capital to projects in underfunded regions—such as parts of Africa and Southeast Asia—where exploration potential remains high but financial backing has been scarce.
Barriers to Adoption
Despite growing interest, several hurdles remain.
Regulatory clarity is still lacking in many jurisdictions. In the United States, the Securities and Exchange Commission (SEC) has yet to finalize guidance on how tokenized assets are to be classified and governed. This legal ambiguity makes it harder for platforms and investors to operate with certainty.
Security is another concern. While blockchain technology is generally secure, high-profile breaches in the crypto space have created skepticism.
Brent crude has swung from lows near $59 in May 2025 to a high of $76 in June amid Middle East tensions, underscoring the persistent volatility that adds risk for investors.
Building investor confidence will require a mix of legal safeguards, compliance protocols, and secure digital infrastructure.
New Capital Source for Energy Transition
Beyond oil and gas, tokenization may play a role in financing low-carbon and transitional energy projects.
In 2024, tokenized energy offerings raised roughly $500 million worldwide, with 60% of that funding going to projects linked to carbon reduction or cleaner operations. These included carbon capture systems and hybrid models that integrate renewables into traditional oil operations.
Such projects reflect the broader shift as energy companies look to lower emissions and comply with decarbonization targets such as the industry-wide goal to reduce emissions by 30% by 2030.
Tokenization could offer one way to fund these efforts by mobilizing capital that might not otherwise flow into long-gestation or early-stage sustainability initiatives.
Outlook
Tokenization is still in its early stages but its application to the oil and gas industry is beginning to take shape. While technical, legal, and market risks remain, the potential for broader access to investment, greater liquidity, and faster capital deployment is drawing interest from both traditional players and new entrants.
For an industry that has long operated behind high financial walls, tokenization presents an opportunity to rethink how assets are financed, owned, and traded, without necessarily changing the assets themselves.
Author: Sameer Pal
Sources and references:
www.ledgerinsights.com/mckinsey-estimates-tokenization-will-be-less-than-2-trillion-by-2030/
