NNPC: Nigeria Oil Reforms Drive 600,000 BPD Production Increase

• Nigeria's crude oil production has increased by 600,000 barrels per day, reaching 1.8 million barrels daily.
• The Nigerian National Petroleum Company Limited attributes this rise to oil and gas sector reforms, including the Petroleum Industry Act.
• NNPC aims to achieve a crude oil production target of 2 million barrels per day by 2027.
• This improvement is intended to attract international investment and enhance Nigeria's global energy market competitiveness.
• The country is also advancing a compressed natural gas initiative with over 400 conversion centers to reduce reliance on petrol.

The NNPC boss specifically highlighted the implementation of the Petroleum Industry Act (PIA) of 2021 as a key driver behind the recent production gains.

Nigeria's crude oil production has seen a significant boost, increasing by 600,000 barrels per day, according to the Nigerian National Petroleum Company Limited (NNPC). This rise elevates the nation's daily output from approximately 1.2 million barrels to 1.8 million barrels. The state-owned oil company credits this improvement to comprehensive reforms within the oil and gas sector, alongside enhanced investment conditions and stronger partnerships across the industry. This development is seen as a strategic move to attract greater international investment and enhance Nigeria's competitive standing in the global energy market.

Bayo Ojulari, the Group Chief Executive Officer of NNPC Limited, revealed these figures during an energy discussion titled ‘Nigeria’s Reform Agenda: Competing for Energy Capital.’ The event took place on Tuesday at the 2026 Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) in the United Arab Emirates. A formal statement detailing the proceedings was subsequently released by Andy Odeh, NNPC’s Chief Corporate Communications Officer, on the same day. Ojulari participated in a session moderated by John Defterios, who serves as Chairman for MENA at APCO.

The NNPC boss specifically highlighted the implementation of the Petroleum Industry Act (PIA) of 2021 as a key driver behind the recent production gains. He also cited improved investment decisions and closer working relationships between NNPC and its industry partners as crucial factors. This positive trajectory marks a reversal of a prolonged period of declining crude oil output, which had been plagued by issues such as oil theft, pipeline vandalism, chronic underinvestment, and operational disruptions. For years, Nigeria struggled to consistently meet its production quotas set by the Organization of Petroleum Exporting Countries (OPEC), despite crude oil being the primary source of its foreign exchange earnings.

The current production level of 1.8 million barrels per day is considered an important milestone on Nigeria's path to energy stability and growth. However, Ojulari emphasized that sustaining these gains will necessitate the successful execution of ongoing projects and the rehabilitation of vital infrastructure. He affirmed that the NNPC's management and board are fully committed to fulfilling the projections outlined in the mandate provided by President Bola Tinubu, underscoring a focused approach to operational excellence and strategic development.

Looking ahead, NNPC Limited has set an ambitious target to reach a crude oil production capacity of two million barrels per day by 2027. This objective is underpinned by a multi-faceted strategy that prioritizes the protection of existing production assets, diligent maintenance of critical infrastructure, and the accelerated development of new projects. Ojulari articulated the company's focus on foundational elements, stating that efforts are concentrated on maintaining infrastructure, safeguarding base operations, and implementing projects designed to further elevate production levels.

A comprehensive baseline assessment of NNPC’s assets and infrastructure has been instrumental in guiding this strategy. This assessment has provided the management with a clear understanding of the company’s portfolio, enabling them to identify inherent strengths and pinpoint areas requiring immediate attention and investment. Ojulari underscored the importance of tangible results, remarking that the company's performance will ultimately be judged by its actions rather than its pronouncements.

Beyond crude oil production, Nigeria is also making strides in its domestic energy market. The removal of the petrol subsidy has been complemented by a significant initiative focused on compressed natural gas (CNG). This program aims to reduce the nation's reliance on traditional petrol and diesel fuels by promoting the wider adoption of locally available natural gas. To support this transition, more than 400 CNG conversion centers have already been established across the country, indicating a concerted effort towards energy diversification and sustainability.

Lawyers advising clients in Nigeria's oil and gas sector should note the reported success of the Petroleum Industry Act in boosting production and attracting investment, indicating a more stable and potentially lucrative regulatory environment for new projects and existing operations. This development may lead to increased deal flow and a need for expertise in navigating the PIA's provisions for foreign and domestic investors.

Source: Original reporting via PUNCH Nigeria