Global value chains analysis has focused attention on ‘upgrading’ along the petroleum value chain as a way of producing higher value exports. In theory, such a strategy involves the encouragement of forward, backward and sideways linkages along the commodity chain as well as maximizing the benefit from consumption and fiscal linkages. While a great deal has been written about such approaches—and in theory they should indeed lead to economic growth, diversification and increased employment—there is very little empirical evidence that they can produce such outcomes in the oil and gas industry for resource-rich countries in Africa. Building on case studies of indigenous Nigerian oil service companies conducted in 2010 and updated in 2015, this paper explores the developmental and distributional challenges indigenous companies encounter in participating in petroleum value chains and policy implications for African seeking to achieve petro-development. In particular, the paper will assess the performance of Nigeria’s 2010 local content law in encouraging local value addition.