By Sunday Michael Ogwu
Given the 575.5 million barrels produced throughout 2024, Nigeria’s oil industry could have generated an estimated $46.04 billion in revenue from crude oil sales in 2024.
According to the most recent reconciled production data for the year by the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), Nigeria, one of the top oil producers in Africa, has seen its oil output bounce back in 2024.
While the country’s oil industry faces continued challenges from both domestic and international pressures, the latest figures indicate a hopeful trajectory toward recovery and stabilisation.
According to the detailed report from January to December 2024, Nigeria’s total liquid production—which includes both crude oil and condensates—has demonstrated significant year-on-year growth.
However, the production figures also highlight several areas where the country’s oil industry must navigate obstacles to maintain consistent output in the future.
The Data at a Glance: A Resilient Year for Oil Production
Over the course of 2024, Nigeria produced a total of 575.5 million barrels of crude oil and condensates, including both blended and unblended types.
The country’s output ranged from around 51 million barrels in January to a peak of 52.23 million barrels in December. On average, Nigeria produced approximately 47.8 million barrels per month in 2024.
This production reflects a strong recovery in comparison to 2023, where output fluctuated more significantly due to disruptions caused by security issues, pipeline vandalism, and other operational challenges.
Nigeria’s 2024 Earnings
The income Nigeria generates from its oil exports is heavily influenced by the global price of crude oil, which is subject to market dynamics. In 2024, the price of Brent Crude, Nigeria’s primary export, has averaged approximately $80 per barrel. This figure is based on market trends and is reflective of the global price movement in 2024.
Here’s the breakdown:
- Total production: 575.5 million barrels
- Average price per barrel: $80
- Estimated income from oil exports: 575.5 million barrels × $80 = $46.04 billion
While this estimate assumes that all of Nigeria’s crude oil production was exported at the prevailing price of $80 per barrel, the actual income may vary due to fluctuations in international oil prices, transport and handling costs, and other factors related to the oil market.
Monthly Breakdown
The monthly data shows that Nigeria’s oil production in 2024 was largely stable, but not without its peaks and valleys.
The first quarter, for instance, reflected January, February, and March figures of 51.2, 44.8, and 44.7 million barrels, respectively.
However, the highest output was recorded in December, with 52.2 million barrels produced—a significant end to the year that suggests the country’s recovery from earlier challenges.
Notably, the production of condensates—the lighter, natural gas-derived liquids—was an important contributor to this rise.
Condensates made up a major portion of Nigeria’s production, with fluctuations between 1.7 million barrels and 2 million barrels throughout the year.
The Oil Crisis and Nigeria’s Recovery Efforts
Nigeria’s oil production has long been impacted by a combination of internal factors like ageing infrastructure, pipeline vandalism, and the ongoing security challenges in the Niger Delta region.
Additionally, global market dynamics, particularly oil price fluctuations, have directly influenced the profitability and stability of Nigeria’s oil sector.
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In 2023, the Nigerian government set ambitious goals for the year 2024, driven by the need for a more robust oil production recovery following several years of declining output.
By the end of 2024, the sector had stabilised, with production steadily returning to pre-pandemic levels.
However, the challenges remain as the country grapples with oil theft, environmental degradation, and the need for major infrastructural investments to boost efficiency and output.
The reconciled production figures highlight several regions and oil terminals, such as Bonny, Forcados, Bonga, and Qua Iboe, where production numbers exceeded expectations, despite systemic challenges.
These terminals, especially Bonga, which produced over 3.7 million barrels in January alone, continue to be vital in driving Nigeria’s oil sector forward.
Vital Oil Terminals Drive Production
The Bonga terminal, Nigeria’s largest deepwater oil field, consistently performed well throughout the year, with notable production figures such as 3.7 million barrels in January and 4.5 million barrels in December.
This terminal, in particular, has been instrumental in stabilising Nigeria’s oil production, despite challenges like regulatory changes and technical difficulties.
Meanwhile, the Forcados terminal—one of the country’s largest crude oil export terminals—also played a significant role.
In August 2024, Forcados hit 7.5 million barrels in production, demonstrating the terminal’s capacity to adapt and perform even when oil theft and other obstacles challenge the overall industry.
It is important to note that while these larger terminals have fared well, there have also been concerns about the decline in production at smaller terminals like Okoro, Otakpipo, and Asaramatoru, which recorded significantly lower outputs compared to their larger counterparts.
This highlights a crucial vulnerability in Nigeria’s oil infrastructure—while the bigger fields are thriving, smaller fields are often neglected, leading to decreased productivity.
Policy Moves and Industry Response
The Nigerian government has made efforts to streamline operations within the oil sector, focusing on improving the Petroleum Industry Act (PIA) and engaging in dialogues with stakeholders in the energy sector.
These reforms aim to boost efficiency and attract investment into Nigeria’s oil and gas industry. However, the full impact of these reforms remains to be seen.
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In addition, the Nigerian National Petroleum Corporation (NNPC) and other stakeholders have ramped up efforts to address environmental concerns arising from oil exploration activities.
These initiatives, if successful, could help ensure that oil production remains viable in the long run and that Nigeria meets international standards for environmental sustainability.
Cautious Optimism for Nigeria’s Oil Sector
Booed by the performance of 2024, the Group Chief Executive Officer of Nigerian National Petroleum Company Limited, Bashir Ojulari, has told President Bola Tinubu that the company is targeting 1.9 million barrels per day of crude oil production by the end of the year.
The target was contained in a statement by the Special Adviser to the President (Information & Strategy), Bayo Onanuga, on May 22, during the inauguration of the NNPC Limited Board at the State House on Thursday in Abuja.
However, analysts have contended that despite Nigeria’s oil sector showing signs of recovery in 2024, with a positive upward trend in monthly production figures, challenges related to infrastructure, security, and global market dynamics remain significant.
Energy expert and CEO of Dairy Hills, Kelvin Emmanuel, acknowledged that while some progress has been made, it has been slow and uneven.
Emmanuel emphasised that substantial work remains to be done.
According to him, “The government must develop a clear commercial framework for offshore and non-associated gas production; implement a robust hydrocarbon accounting system in the upstream sector to curb technical losses; transition from Joint Venture-led procurement to best practice-based systems, ideally through an Incorporated Joint Venture model under Section 65 of the PIA.”
He also called for reforming the commercial model for pipeline infrastructure, expanding evacuation infrastructure for refined products nationwide, and moving NNPC Limited from government control to a fully market-driven entity, which can only be achieved through unbundling and an eventual IPO.
Sunday Michael Ogwu is a Nigerian journalist and editor of Pinnacle Daily. He is known for his work in business and economic reporting. He has held editorial roles in prominent Nigerian media outlets, where he has focused on economic policy, financial markets, and developmental issues affecting Nigeria and Africa more broadly.
