Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, has attributed the significant increase in Nigeria’s crude oil production and investment inflows to reforms introduced by the administration of President Bola Tinubu.
Lokpobiri said the reforms had raised the country’s crude oil and condensate production by more than 80 per cent since the administration assumed office in 2023.
The Minister spoke in Yenagoa on Friday in Bayelsa State, at a breakfast meeting with media friends led by Elder Asu Beks, with the theme, “Counting the Gains of the Oil Sector Reforms Under President Bola Tinubu.”
According to him, Nigeria was producing less than one million barrels per day of crude oil and condensate when the Tinubu administration came into office.
He said the latest weekly report of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) showed that production had risen to 1.824 million barrels per day, including condensate.
“Condensate is not counted by OPEC. As of the last weekly report from NUPRC, we are producing 1,824,000 barrels per day inclusive of condensate. That is over 80 per cent from where we started in 2023,” he said.
Lokpobiri said the increase was achieved through the commitment of stakeholders in the sector, under the leadership of President Tinubu.
He disclosed that the country previously had fewer than 10 active drilling rigs and had recorded no significant seismic activity for more than two decades.
According to him, Nigeria now has more than 70 active drilling rigs, with the cost of drilling estimated at between $25 million and $30 million per well onshore, and between $80 million and $100 million for deep offshore operations.
The minister also claimed that Nigeria had recorded a major turnaround in oil and gas investment, saying the country now accounts for about 60 per cent of oil and gas investments coming into Africa.
He said the administration’s approval of major divestments by Shell to Renaissance and ExxonMobil to Seplat had helped unlock fresh investments in the sector.
Lokpobiri said the approvals, which he claimed had been delayed by the previous administration, had paved the way for investments in projects including Bonga North, Bonga South-West and Zabazaba.
He further disclosed that indigenous oil companies now account for about 60 per cent of Nigeria’s crude oil production, compared with the period when International Oil Companies (IOCs) accounted for about 90 per cent of production.
On the removal of fuel subsidy, the minister described the decision as inevitable, saying the country had been spending heavily to sustain the scheme.
He said Nigeria was spending about N18.4 billion daily on fuel subsidy at an exchange rate of N448 to the dollar, translating to about $15 billion annually.
At an exchange rate of N1,400 to the dollar, he said, the amount would have amounted to approximately N21 trillion.
Lokpobiri also said the reforms had strengthened the financial position of the Nigerian National Petroleum Company Limited (NNPCL), which, according to him, now declares profits, contributes to the Federation Account and meets its financial obligations.
He said the removal of subsidy had also contributed to an increase in monthly allocations from the Federation Account Allocation Committee (FAAC), from less than N600 billion to more than N2 trillion.
According to him, the increased allocations had enabled 27 states that previously struggled to pay workers’ salaries to meet their obligations and embark on development projects.
The minister cited Section 205 of the Petroleum Industry Act (PIA), signed into law by former President Muhammadu Buhari, as providing for market-based pricing of petroleum products.
He said deregulation had also enabled the Dangote Refinery to supply aviation fuel to markets in Europe.
Lokpobiri further claimed that Nigeria had previously been subsidising petrol consumption across the West and Central African region.
On Bayelsa State’s Atala oil field, the minister said the state government had lost its case at both the Federal High Court and the Court of Appeal.
He, however, said discussions were ongoing to explore a political solution that could facilitate funding for the development of the field.
He also spoke on OML 240, which he said belonged to Bayelsa State and was awarded more than two decades ago but had since expired.
According to him, a Norwegian company has been brought into the process to develop the oil asset.
