Nigeria’s oil output rises 13% to 1.7m bpd as NUPRC initiatives yield fruits
By Ibrahim Musa
There are indications that the innovative initiatives of the Nigerian Upstream Petroleum Regulatory Commission, NUPRC, have continued to bear fruits as the nation’s oil output, including Condensate increased year-on-year, YoY, by 13.3 per cent to 1.7 million barrels per day, bpd, in November 2024, from 1.5 million bpd recorded in the corresponding period of 2023.
In October 2024, NUPRC launched the One Million Barrels Per Day production initiative, targeted at increasing Nigeria’s daily output to over 2.7 million bpd. Earlier, in May 2024, the Commission Chief Executive, CCE, Engr. Gbenga Komolafe announced a bid round for oil blocks at the Offshore Technology Conference in Houston, Texas, which attracted major global investors.
The Drill or Drop initiative, another game-changer, requires oil producers to drill within a specified timeframe or forfeit their licenses areas to others ready and willing to develop them.
However, on month-on-month, MoM basis, the nation’s output rose by 10 per cent increase to 1.7 million barrels per day, bpd, in November 2024, from 1.5 million bpd in October 2024.
Apart from the nation’s 1.8 million bpd peak output recorded in October, the December 2024 Nigerian Upstream Petroleum Regulatory Commission, NUPRC’s data – Oil Production Output Report – indicated that the latest output remains the highest in 2024.
The authoritative report showed that the nation recorded 1.6 million bpd, including Condensate in January 2024, which dropped slightly to 1.5 million bpd before hitting the current very impressive level.
A closer look at the report showed that the nation recorded a significant leap in both crude oil and Condensate production from major terminals like Bonny, Brass, Qua Iboe, Forcados, Escravos, Odudu and Tulja Okwuibome during the period.
For instance, in October 2024, crude oil, excluding Condensate increased by 15.4 per cent to 1.5 million bpd, from 1.3 million bpd in September 2024 while Condensate output also increased to 204,828 bpd in November 2024, from 204,805 bpd in October 2024.
Output to impact budget 2025, others
The leap in output constitutes a good omen for the nation’s 2025 budget that was based on 1.7 million bpd and $75 per barrel, respectively.
It would increase domestic revenue generation while reducing foreign borrowing, especially as the NUPRC has already exceeded its revenue target by 49 per cent.
This revenue growth is attributed to its strategic overhaul of Nigeria’s upstream petroleum sector through regulatory reforms; the commission has plugged financial leakages and attracted substantial investments, despite the divestment of some oil and gas assets.
Future looks bright
The future looks bright for Nigeria’s oil output growth as there are indications that it would continue to rise, especially in medium and long term because of many factors, including the strong foundation laid by the regulator.
The recent successful divestment of the International Oil Companies, IoCs, midwifed by the NUPRC would culminate in increased investment and sustainable output growth.
Already, under its work programme approved by the NUPRC, Seplat Energy has concluded plans to execute “a combination of rejuvenation of existing wells, drilling new wells in the producing fields, installing gas lift lines, perforating intervals that are behind pipe in existing wells and developing pools proven to contain oil but are currently undeveloped (the additional projects).”
As listed in the company prospectus, “In addition to these additional projects the programme also contains the drilling of exploration wells to mature prospective targets and have been categorised as near field wildcats (NFW).”
According to the prospectus, “The Reserves associated with the projects that involve the drilling of new wells or require major capital expenditure comparable to the cost of a new well have been classed as undeveloped. The Reserves associated with projects that require minor expenditure relative to a new well have been classed as Developed Non-producing. These involve projects such as workovers, re-completions and development of the behind pipe resources in existing well. The work programme that has been identified by SEOL spans the years 2025-2037.”
The nation’s oil growth would not only be driven by Seplat Energy alone but also others as the NUPRC has already granted approvals to the NAOC-Oando and Equinor-Chappal divestments in accordance with the Petroleum Industry Act (PIA) of 2021.
Journey so far
The increased oil output would not have been realized without intentional plans and execution of projects and programmes.
Speaking during the third anniversary of NUPRC, Engr. Komolafe, said: “We have successfully introduced critical regulations in collaboration with industry stakeholders that operationalize the PIA and entrench regulatory clarity, predictability, and transparency. So far, 25 priority Regulations have been developed and 17 gazetted. This approach has optimised regulatory processes and has boosted investors’ confidence.
“We have maintained a healthy Reserves to Production ratio which is key to ensuring the long-term sustainability of Nigeria’s energy resources, with due cognisance to global energy dynamics. To this end, we are confident that the ongoing activities of Petroleum Prospecting License, PPL Awardees and the Licencing Rounds will further boost Nigeria’s position and unlock additional opportunities for resource valorisation.
“Our efforts are yielding satisfactory results as evidenced by the level of upstream activities within the past year. The industry has witnessed a notable increase in rig activities, well intervention, and field developments, signaling a positive trend to boost production. This uptick reflects both the impact of regulatory reforms driven by the Commission and a renewed focus on maximizing the potential of our oil and gas assets.
“We are glad to report that with the concerted efforts of relevant stakeholders, production has grown from 1.2 million to 1.6 million bopd today. Although we acknowledge these modest gains as graciously alluded to by Mr. President in his August 2024 speech to the nation, this is far short of the Presidential charge to us to grow production to sustainable and economic levels. Working together to achieve this mandate is the main thrust of our gathering here.”
He also said: “Further to the PIA and the 2020 Bid Round, a total of 50 Marginal fields have been converted to Petroleum Prospecting Licenses (PPLs), together with a minimum work programme that allows for early development and maturation of the assets. The streamlined work program is projected to bring the fields into production within three (3) years and some have already made significant progress on field studies, well interventions, and project development. It is anticipated that about 60,000 bopd and 90MMscfd 8 of incremental oil and gas production will be realized from these assets in the near term.
“To enhance investment attractiveness and improve global competitiveness, the Licensing framework for the Bid Rounds was optimized following the PIA to vacate entry barriers and eliminate huge asset acquisition fees. We applaud the visionary leadership of His Excellency, Bola Ahmed Tinubu, for approving the licensing models and attractive entry fee regime based on comparative study and global benchmarks. With these innovative regulatory approaches, we have noted considerable investment appetite and are on course for a successful Bid Round.”
• Ibrahim Musa is an Energy Analyst
