- Nigeria’s Federal Government aims to increase crude oil production by 1 million barrels per day within 12-24 months.
- The initiative, “Project 1MMBPD,” targets challenges like oil theft, vandalism, outdated infrastructure, and attracting investment.
- President Bola Ahmed Tinubu emphasized increasing oil production boosts national revenue and economic development.
- Minister Heineken Lokpobiri urged stakeholders to aim higher, targeting 2.5 million barrels per day short-term and 4 million long-term.
- NUPRC approved four divestment deals, blocking Shell’s $2.4 billion sale to Renaissance.
- Infrastructure challenges and pipeline vandalism hinder output growth.
- Industry leaders stress modernization needs, citing aging infrastructure, regulatory uncertainties, and security challenges in the Niger Delta.
The Federal Government has revealed an ambitious plan to increase Nigeria’s crude oil production by one million barrels per day within the next 12 to 24 months.
This strategy aims to tackle key challenges in the sector, such as oil theft, pipeline vandalism, outdated infrastructure, and attracting investment.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) reported a dip in production from 1.571 million barrels per day in August to 1.544 million in September, representing a 1.68% decline. Despite this, the government’s new initiative promises to drive production back up through a series of targeted interventions.
Speaking at the launch of “Project 1MMBPD” to mark NUPRC’s three-year anniversary, President Bola Ahmed Tinubu, represented by the Secretary to the Government of the Federation, Senator George Akume, emphasized that increasing oil production is key to boosting national revenue and accelerating economic development.
The President noted, “Project one million barrels per day is a giant step forward for our oil and gas industry, designed to grow sustainably. By enhancing domestic energy security and supporting economic vibrancy, this initiative will ensure Nigeria remains a crucial player in the global energy landscape.”
Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, also stressed that the current target of one million barrels per day is insufficient, urging industry stakeholders to aim for higher production levels. “For a country that once produced over two million barrels per day, the present additional one million target is unacceptable. We should be aiming for 2.5 million in the short term and four million barrels per day in the long term,” he said.
Four Divestment Deals Approved, Shell Blocked
In his address, NUPRC Commission Chief Executive, Engr. Gbenga Komolafe, announced the government’s decision to block Shell’s $2.4 billion divestment of its onshore and shallow water assets to local consortium Renaissance. However, four other divestment deals received government approval, including ExxonMobil’s sale of Mobil Producing Nigeria Unlimited to Seplat Energy.
“Out of the five divestment applications received by the Commission, four passed the regulatory test and secured ministerial consent,” Komolafe said. The approved deals include Equinor Nigeria Energy’s sale to Project Odinmin Investments, Nigerian Agip Oil Company’s sale to Oando Petroleum, and TotalEnergies EP Nigeria Limited’s sale to Telema Energies Nigeria.
Infrastructure Challenges
Group CEO of NNPC Limited, Mallam Mele Kyari, identified aging infrastructure and pipeline vandalism as key obstacles to increasing output. “We are dealing with infrastructures that are over 50 years old. Without replacing these, you cannot evacuate the additional one million barrels of oil, especially from onshore assets,” he stated.
Need for Modernization
UBA Group Chairman, Tony Elumelu, echoed the call for modernization, warning that Nigeria’s oil production has been on a downward trajectory, dropping from over two million barrels per day to below 1.5 million. Elumelu stressed that outdated infrastructure, regulatory uncertainties, and security challenges in the Niger Delta are undermining the nation’s oil sector and, consequently, the economy.
“As a nation, we cannot permit this decline to continue. We must modernize our oil and gas infrastructure to safeguard our economy and ensure prosperity for future generations,” he urged.
