Africa’s largest crude oil producer, Nigeria, oil production is nearing its 1.5 million-barrel-per-day (bpd) quota set by OPEC+.
This turnaround follows years of declining production driven by theft, vandalism, and underinvestment, Investors King reports.
Crude oil production rose to 1.48 million barrels per day in December 2024, a sharp rebound from the 1.1 million bpd recorded in 2022.
The improvement is largely attributed to enhanced security measures and renewed investment efforts, according to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The government through the Nigerian National Petroleum Company (NNPC) Ltd established a production monitoring command center to track activity in real-time and complements ground-level security measures.
“These measures are starting to bear fruit,” said Ifeanyi Onyegiri, a senior analyst at Welligence.
However, Onyegiri cautioned that sustained success would depend on the long-term effectiveness of the security improvements.
Gbenga Komolafe, Chief Executive Officer of the NUPRC, “Nigeria is occupied with increasing production first to meet its budget aspiration, and then will engage with OPEC to raise the nation’s quota.”
Nigeria’s recovery is also supported by increased participation from indigenous operators following asset sales by international oil majors like ExxonMobil and Equinor. Companies like Seplat Energy Plc and Oando Plc are leading the charge with ambitious production plans.
Seplat Energy plans to double its output to 120,000 bpd within six months after acquiring Exxon’s onshore oil and gas assets.
Oando Plc, under the leadership of Wale Tinubu, has similarly scaled up its operations.
Alex Irune, Managing Director of Oando Energy Resources, said the company plans to increase production from 40,000 bpd to 100,000 bpd over the next few years.
“Nigeria has both the spare capacity and resources to achieve and even surpass, the 2 million barrels-per-day mark,” Irune said.
Analysts warn that sustained output growth could strain relations with OPEC+, which enforces production limits to manage supply.
Nigeria may follow the example of other members like the United Arab Emirates, which secured a higher quota after demonstrating expanded productive capacity.
“Given the country’s current fiscal situation, there’s a lot of incentive to produce in excess of the OPEC quota, as any incremental revenue has a direct impact on budget deficit,” said Dipo Ogunbiyi, an energy analyst at Renaissance Capital Africa.
Analysts like Pranav Joshi of Rystad Energy emphasize that sustained success will depend on addressing vandalism across the vast Niger Delta pipeline network.
“The main bottleneck is: Can they fix the vandalism issue in a sustained way?” Joshi said.
