February 17, 2025/CSL Research
According to the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), crude oil production, excluding condensates rose by 3.6% in January to 1.54 million barrels per day (mbpd), up from 1.48 mbpd in December. This represents the highest production level since March 2021 and marks the first time in several months that Nigeria has surpassed OPEC’s quota of 1.5 mbpd. Including condensate, production increased by 69,920 barrels per day, rising from 1.68 mbpd in December to 1.74 mbpd in January 2025. Despite this improvement, Nigeria’s oil sector continues to face significant challenges including widespread crude oil theft in the Niger Delta, aging oil fields and declining reservoir performance, poor infrastructure maintenance resulting in frequent shutdowns, and reduced upstream investments hampering capacity expansion and efficiency.
The January 2025 production data revealed variations across terminals. The Forcados Terminal
maintained steady output growth, increasing by 4.3% to 8.86 million barrels from 8.49 million barrels in December. Similarly, the Bonny Terminal saw a 4.6% rise in production, reaching 8.14 million barrels compared to 7.78 million barrels the previous month. The Escravos Terminal recorded the most significant gain, surging by 14.6% to 4.48 million barrels. In contrast, some terminals experienced declines. The Odudu Terminal saw a 5% drop in output, falling to 2.33 million barrels from 2.45 million barrels in December. The Bonga Terminal recorded the sharpest decrease, with production declining by 11.5% to 4.02 million barrels from 4.54 million barrels the previous month.
Nigeria’s persistently low oil production has led to significant revenue losses and a sharp decline in foreign exchange (FX) supply, as crude oil sales remain the country’s primary FX source. Despite efforts in recent years, production has consistently fallen short of both OPEC quotas and the demands of local refineries. To address these challenges, the government has implemented proactive measures such as the Audit of Upstream Measurement Equipment and Facilities (AUMEF). This initiative tackles critical issues, including outdated and malfunctioning measurement equipment, the lack of a comprehensive database of installed equipment, and the absence of real-time production monitoring.
Additionally, the recent oil bid round, which saw local companies acquiring onshore assets from International Oil Companies (IOCs), has improved prospects for sustained crude oil production in 2025. The Nigerian government remains committed to increasing oil output from 1.5 million barrels per day (mbpd) to over 2 million bpd in 2025. However, achieving this target may prove challenging, making us project an average production level of 1.66 mbpd in 2025.
CSL Nigeria Daily – 17 February 2025 – Crude Oil.doc.pdf
