Nigeria is pushing to secure a higher crude oil production quota from the Organization of Petroleum Exporting Countries (OPEC) as it recovers from years of declining output. Gbenga Komolafe, Chief Executive of the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), said Nigeria aims to increase production to meet budget targets before officially requesting the quota increase. “Nigeria’s priority is to ramp up production to align with its budget targets before approaching OPEC,” he noted.
In December 2024, Nigeria’s crude production rose to 1.48 million barrels per day (bpd), just below its OPEC allocation of 1.5 million bpd. This marks a recovery from a 2022 low of 1.1 million bpd due to extensive theft and pipeline vandalism.
Efforts to combat oil theft, improve security, and attract investments have driven the rebound. The government projects production to hit 2 million bpd—the highest in a decade. Security remains a challenge in the Niger Delta, where criminals previously tapped over 150 illegal points along the Trans-Niger Pipeline, causing producers to receive only a fraction of transported crude.
To address this, the Nigerian National Petroleum Company (NNPC) introduced measures such as real-time monitoring systems and community partnerships to protect pipelines. “These strategies are delivering results, though at a high financial cost,” said Ifeanyi Onyegiri, a senior analyst at Welligence.
Nigerian firms like Seplat Energy and Oando have significantly contributed to the recovery. Seplat plans to double its production to 120,000 bpd, while Oando targets 100,000 bpd in the coming years.
Despite gains, experts caution that maintaining security across the vast pipeline network remains critical. “Ensuring long-term protection against vandalism is Nigeria’s biggest challenge,” said Pranav Joshi of Rystad Energy.
Rising drilling activity, which has tripled over four years, underscores renewed investor confidence. However, Nigeria’s ambition to exceed 2 million bpd may clash with OPEC’s production limits aimed at stabilizing global oil prices.
Recent OPEC decisions offer mixed signals. Angola exited the cartel in 2023 after rejecting stricter output controls, while the UAE negotiated a higher quota in 2024 due to expanded production capacity.
Analysts suggest Nigeria may prioritize increased output over OPEC compliance due to pressing fiscal needs. “Exceeding its OPEC quota is tempting, as it directly addresses Nigeria’s budget deficit,” said energy analyst Dipo Ogunbiyi.
Meanwhile, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has issued 10 Gas Distribution Licenses (GDLs) to six companies, including NNPC Gas Marketing Company, Shell Nigeria Gas, and Falcon Corporation.
NMDPRA Chief Executive Farouk Ahmed said the licenses were awarded under strict eligibility criteria and would drive “last-mile” gas distribution to create an interconnected national gas network.
