Nigeria declares emergency production in oil industry to boost output by 2024

Nigeria declares emergency production in oil industry to boost output by 2024

The Nigerian National Petroleum Corporation (NNPC Ltd) has declared an emergency production in Nigeria's oil and gas industry as Africa's largest oil producer struggles to increase production.Drilling Rigs

NNPC Group CEO Mele Kyari said at an industry event this week that the company believes Nigeria needs to take urgent action to address challenges that have plagued the oil and gas industry for years.

Increasing oil production has been a priority for Nigeria's federal government, which aims to increase revenue and foreign exchange reserves.

Oil theft and pipeline sabotage have long plagued Nigeria's upstream oil and gas industry, forcing oil majors to withdraw from the country and often resulting in force majeure on major crude oil exports.

Pipeline sabotage, oil theft and insufficient investment in production capacity have made Nigeria the largest laggard in crude oil production in the OPEC+ alliance. OPEC even cut Nigeria's oil production quota last year due to insufficient production.

Kyari said an analysis of Nigeria's oil and gas assets found that Nigeria could easily produce 2 million barrels of crude oil per day without deploying new drilling rigs.

Nigeria currently produces about 1.5 million barrels of crude oil per day.

In early May, Nigeria launched a new round of oil and gas license bidding, bidding for 12 onshore and offshore blocks, and promised a transparent bidding process.

In recent years, major international oil companies have reduced their investment in Nigeria's energy sector. In addition to oil theft and frequent pipeline damage, the transparency of license issuance is also one of the reasons why oil giants divest Nigerian assets.