January 21, 2025/CSL Research
According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), crude oil production, including condensates, averaged 1.55 mbpd, marking a 5.44% year-on-year increase from the 1.47 mbpd recorded in 2023. This figure was slightly below our projected 1.56 mbpd forecast for 2024. On a month-on-month basis, production declined by 1.36%, averaging 1.67 mbpd in December, down from 1.69 mbpd in November. Excluding condensates, production saw an 8.06% increase, rising from 1.24 mbpd in 2023 to 1.34 mbpd in 2024. Despite this growth, Nigeria’s oil sector continues to face significant challenges, including widespread crude oil theft in the Niger Delta, aging oil fields with declining reservoir performance, poor infrastructure maintenance causing frequent shutdowns, and reduced upstream investment that limits capacity expansion and operational efficiency.
A detailed analysis of Nigeria’s 2024 production data revealed mixed performance across the country’s oil terminals. The Forcados terminal saw a 12.41% increase in production, averaging 7.61 million barrels, up from 6.77 million barrels in 2023. On the other hand, the Escravos Terminal experienced a 6.36% decline, with output dropping to 4.12 million barrels, compared to 4.44 million barrels in 2023. The Qua Iboe Terminal also reported a decline, down 8.23% to average 3.79 million barrels, down from 4.13 million barrels in 2023. The Bonny Terminal however recorded impressive growth, with output rising by 58.36%, reaching 5.78 million barrels, up from 3.65 million barrels in the previous year. Additionally, the Brass Terminal saw a modest 0.26% increase in production, averaging 891,229 barrels in 2024.
Oil production in Nigeria continues to operate below its potential due to challenges such as oil theft, inadequate investment, and aging infrastructure. However, prospects for improvement in 2025 appear promising, driven by the government’s proactive measures to tackle these issues. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has launched the Audit of Upstream Measurement Equipment and Facilities (AUMEF) to address key challenges, including outdated and malfunctioning measurement equipment, the lack of a comprehensive database of installed equipment, and the absence of real-time production measurement at various locations.
Additionally, the government’s first oil bid round under the Petroleum Industry Act (PIA) has fostered optimism, with several local companies securing bids. This is expected to stimulate exploration, development, and production activities on newly acquired assets. The ongoing divestment of onshore oil assets by International Oil Companies (IOCs) to indigenous companies further strengthens the outlook for increased crude oil production. As a result of these initiatives, Nigeria’s oil production is projected to average 1.66 million barrels per day (mbpd) in 2025.
