Nigeria’s upstream oil regulator unveiled a bold target of achieving a daily production of 2.6 million barrels of oil and condensates by 2026, marking a significant leap from the 1.6 million bpd output recorded in 2023.
The country, a key oil exporter in Africa, has grappled with reduced production levels attributed to crude theft, pipeline vandalism in the Niger Delta, and inadequate investment in the sector, impacting government earnings.
President Bola Tinubu’s administration has secured commitments from major oil players such as TotalEnergies, Shell, and Exxon Mobil, who pledged $13.5 billion in immediate investments after high-level discussions.
According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) 2024-2026 action plan, strategic measures will be taken to direct oil asset development away from areas prone to theft and vandalism. Additionally, the commission will offer regulatory backing for alternative crude evacuation routes, necessitating NUPRC approval for new pipeline routes.
The NUPRC outlined a trajectory foreseeing an increase in oil production from 1.8 million bpd this year, progressively reaching the 2.6 million bpd mark in 2026.
However, assessments from two of three consultancies appointed by OPEC+ cast doubt on Nigeria’s capacity to meet this year’s production target.
The regulator aims to slash production costs from $25-$40 per barrel to approximately $20 by introducing incentives for oil producers. This involves establishing a standardised tariff framework for crude oil and gas transportation costs, alongside implementing an open access regime for upstream oil and gas pipelines and associated facilities.
The NUPRC further emphasised plans to diminish high signature bonuses, aiming to lure more investment and augment oil production.
