Nigeria’s oil output hits 1.8mbpd, FG, NNPCL, IPPG push for gas transition

Nigeria’s energy sector has recorded a significant turnaround, with crude oil production rebounding to over 1.8 million barrels per day (mbpd), inclusive of condensates, Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, has disclosed.

This milestone set the tone for intense deliberations at the opening ceremony of the silver jubilee edition of the Nigerian Oil and Gas (NOG) Energy Week Tuesday in Abuja, where top government officials, regulatory chiefs, and private sector leaders gathered to shape the country’s energy future.

The four-day premier energy event at the Bola Ahmed Tinubu International Conference Centre served as a platform for the federal government to showcase the early fruits of its regulatory reforms, even as industry operators called for a comprehensive review of the Petroleum Industry Act (PIA) 2021 to align it with current economic realities.

Oil production rebound and regulatory streamlining

Declaring the 25th NOG Energy Week open, the minister disclosed that the nation’s crude oil production has climbed to over 1.8 mbpd, representing a massive leap from the low levels of approximately one million barrels per day recorded when he assumed office in August 2023.

According to the minister, the rapid recovery is a direct consequence of a clear directive from President Bola Ahmed Tinubu to eliminate deep-seated administrative and operational bottlenecks clogging the upstream sector.

“Today, I get weekly reports from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC)… the last one I got this week is that we are doing over 1.8 million barrels a day,” Lokpobiri told the gathering of global energy executives.

Lokpobiri attributed the output surge to a renewed wave of investor confidence, which has revitalised drilling activities across the Niger Delta.

He revealed that the number of active drilling rigs in the country had risen from a mere 14 in 2023 to more than 60 currently.

Concerns over exit of IOCs

Addressing concerns regarding the recent exit of international oil companies (IOCs) from onshore assets, Lokpobiri clarified that “no IOC has abandoned Nigeria. Instead, they are strategically reallocating capital to complex deep offshore acreages where they possess a distinct competitive advantage, leaving onshore and shallow-water assets to robust indigenous firms.”

He highlighted key domestic acquisitions, including Renaissance’s takeover of Shell’s onshore assets, Seplat’s acquisition of ExxonMobil, and Oando’s purchase of the Nigerian Agip Oil Company.

“Independents now account for over 60 per cent of our daily production of 1.8 million barrels per day,” Lokpobiri stated.

He commended Renaissance and its joint venture partners for a recent significant offshore oil discovery in OML-74.

To further lower the cost of doing business and boost competitiveness, the minister announced that the federal government had commissioned PricewaterhouseCoopers (PwC) to conduct a global benchmarking exercise on the more than 270 fees, taxes, and levies currently charged by various government agencies across the oil and gas value chain with the explicit goal of streamlining them.

Deepening energy ecosystem

In his keynote address, the Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, Engineer Bashir Bayo Ojulari, advocated for an integrated ecosystem-driven approach in industry collaboration.

He argued that weak linkages between asset owners, financiers, and technology partners remained the primary barrier limiting Africa’s ability to attract global energy capital.

Ojulari reported that NNPC Ltd’s aggressive operational interventions have yielded unprecedented stability.

Between April 2025 and May 2026, he said, the national oil company “recorded an average recovery rate of 98 per cent across its five primary crude oil export terminals. This marks a dramatic turnaround from June 2022, when security and operational challenges dragged recovery rates at the Bonny Oil and Gas Terminal down to an absolute low of about one per cent.”

The GCEO placed “NNPC Ltd’s official crude oil production figure at 1.71 mbpd—the highest level recorded by the firm in five years while its upstream subsidiary, NNPC Exploration and Production Limited (NEPL), achieved a record autonomous production of 365,000 barrels per day. Total natural gas production has similarly climbed to 7.5 billion standard cubic feet per day (bscfd).”

Furthermore, Ojulari announced that NNPC Ltd maintained 100 per cent compliance with all its Joint Venture cash call obligations throughout 2025 and up to June 2026, creating a predictable framework for international partners as the company drives toward a near-term target of 2.0 mbpd.

On commercial breakthroughs, Ojulari revealed that NNPC Ltd has sealed landmark Gas Sale and Purchase Agreements (GSPAs) securing 1.29 bscfd for long-term LNG feed gas and 750 million standard cubic feet per day for domestic industrial consumers, including the Dangote Refinery and DFL FZE.

“These agreements represent more than $20 billion in associated investments, with seven additional commercial transactions in the pipeline,” Ojulari said.

He added that in line with its post-PIA commercial mandate, NNPC Ltd resumed full monthly financial remittances to the Federation Account in July 2025, reinstated monthly business performance reporting, and hosted its inaugural corporate earnings call in November 2025 to cement investor trust.

Transitioning to gas-powered economy

Focusing on the midstream and downstream gas revolution, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, declared that Nigeria was actively transitioning from a nation that merely processes gas for export to an economy fully powered by gas.

With the continent’s largest proven natural gas reserves, estimated at 215 trillion cubic feet (tcf), Ekpo maintained that Nigeria is uniquely positioned to anchor West African energy security while industrialising its domestic space.

The gas minister provided critical updates on national infrastructure projects, confirming that the physical pipeline laying for the strategic Ajaokuta-Kaduna-Kano (AKK) gas project had been completed, following the successful River Niger crossing mentioned by the NNPC GCEO.

“What is remaining is to cross the T’s and dot the I’s and hand over the project for commissioning before the end of this year,” Ekpo assured, adding that the critical OB3 gas pipeline project is similarly nearing full commissioning.

At the int’l and domestic levels

At the international level, Ekpo noted that the ongoing Train 7 expansion project at the Nigeria LNG (NLNG) complex on Bonny Island will successfully scale up production capacity from 22 million tonnes per annum (mtpa) to 30 mtpa upon completion.

He re-emphasised Nigeria’s unwavering geopolitical commitment to transnational energy links, including the Trans-Saharan Gas Pipeline and the West African Atlantic Gas Pipeline, which seek to deliver Nigerian gas directly to North African, European, and sub-regional markets.

Domestically, the minister highlighted two key social interventions: the National Clean Cooking Programme, which aims to transition five million households to Liquefied Petroleum Gas (LPG) by 2030, and the Presidential Compressed Natural Gas (CNG) Initiative, designed to provide alternative fuel and slash public transportation costs by up to 50 per cent.

Ekpo also noted that Nigeria’s official admission as an association country of the International Energy Agency (IEA) on July 2, 2026—making it the very first OPEC member country to attain this status—serves as global validation of the transparency and direction of Nigeria’s current energy policies.

On gains and structural bottlenecks

While acknowledging the significant progress made by the Tinubu administration, the private sector, speaking through the Independent Petroleum Producers Group (IPPG), urged the government not to succumb to complacency.

IPPG Chairman, Adegbite Falade, commended the executive arm for securing over $8 billion in major upstream Final Investment Decisions (FIDs) since 2023, including flagship projects like Shell’s Bonga North and TotalEnergies’ Ubeta.

This influx of capital, Falade said,  “has pushed Nigeria’s share of total upstream FIDs in Africa from a dismal four per cent a decade ago to nearly 40 per cent over the last two years.”

However, Falade warned that historical capacity constraints and bureaucratic delays in previous years caused Nigeria to miss out on vital revenue windfalls during recent European and Middle Eastern geopolitical supply disruptions.

“The lesson from both crises is the same—the next geopolitical shock is not a question of if, but when,” Falade cautioned.

“Let’s borrow a leaf from Dangote Refinery by prioritising upfront investment in potent capacity. We must see infrastructure not just as an economic asset, but as a strategic national shield,” he said.

To safeguard independent local producers who are taking over mature assets characterised by thin operating margins, the IPPG boss appealed to the federal government to swiftly eliminate overlapping and duplicating fees levied by competing regulatory agencies, warning that excessive fiscal friction could derail marginal field viability.

He further raised the alarm over an impending human capital crisis triggered by the rapid exit of IOCs and the retirement of a legacy generation of oilfield professionals, describing it as an “existential threat” to the local industry.

He called for aggressive industry-wide human capital development, noting it must be treated as a core business survival strategy rather than mere corporate social responsibility.