NNPCL Oil Output May Drop by 50% – Reports

• NNPCL Oil Output May Drop by 50% – Reports .
• Sub-commercial assets, high costs, poor infrastructure blamed.
• Deepwater projects, new investments crucial to avert slump.

Oil and gas production by the Nigerian National Petroleum Company Limited (NNPCL) could decline by as much as 50% by the late 2030s due to a portfolio weighed down by sub-commercial assets, global consultancy firm Wood Mackenzie has warned.

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EKO HOT BLOG reports that in a recent podcast titled “A New Era for NNPC and Nigeria’s Upstream Oil & Gas Sector”, analysts from the firm including Ian Thom, Neivan Boroujerdi, and Mansur Mohammed, revealed that NNPCL’s upstream ambitions may fall short unless new commercial projects are urgently developed.

According to their findings, most of NNPCL’s assets are non-operated and depend heavily on international and indigenous partners for development. While production is projected to peak in 2026, it could fall drastically without substantial investment and infrastructure improvements.

The warning comes as NNPCL pursues ambitious goals set by President Bola Tinubu: attracting $60 billion in investments by 2030, increasing daily oil output to three million barrels, and gas production to 10 billion cubic feet per day.

Despite efforts to boost output — including a plan by NNPCL subsidiary NEPL to increase production from 370,000 to 550,000 barrels per day by 2027 — challenges remain.

These include high operational costs, infrastructure delays like the OB3 gas pipeline, and difficulty monetising gas reserves. Analysts also pointed to a lack of financing options, especially as indigenous companies replace international oil majors in onshore and shallow water ventures.

NNPCL Oil Output May Drop

Wood Mackenzie noted that deep water fields offer the most promising future for Nigeria’s oil sector. Projects like Bonga North, which received final investment approval in 2023 — the first deep water FID since 2013 — represent the path forward.

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