The Nigerian National Petroleum Company Limited (NNPC) is partnering with international oil companies (IOCs) and local producers to cut production costs. The plan could save $3 billion this year and reach $4.5 billion by December 2025.
Group Chief Executive Officer Bayo Ojulari revealed the initiative at the Nigerian Association of Petroleum Explorationists’ (NAPE) 50th anniversary in Lagos. He was represented by Udobong Ntia, Executive Vice President for Upstream. According to him, the strategy focuses on lowering unit operating and technical costs to unlock more sector value.
“We’re re-engineering our operations to reduce expenses. In six months, we identified $3 billion in savings. Our next target is $4.5 billion before year-end,” Ojulari said. He added that lowering the cost per barrel will improve Nigeria’s competitiveness globally.
Tackling Persistent High Costs
Nigeria’s production costs range from $20 to $40 per barrel, among the highest worldwide. Multiple taxes, levies, security issues, and intermediary fees drive these figures. By comparison, global averages are far lower.
President Bola Tinubu has set a two-year target to attract $30 billion in oil and gas investment. The government hopes to double this to $60 billion by 2030. To achieve this, it plans to increase activities across deepwater, shallow offshore, land, and swamp fields.
Boosting Output and Investment
Output rose from 1.4 million barrels per day (bpd) in late 2024 to 1.69 million bpd in June 2025. It briefly peaked at 1.8 million bpd in July.
Major projects, such as the $5 billion Bonga North development, are expected to add 150,000 bpd. Nigerian Upstream Petroleum Regulatory Commission (NUPRC) CEO Gbenga Komolafe also projects that the country’s active rig count could reach 50 by year-end, up from eight in 2021.
Nigeria holds 37.28 billion barrels of crude reserves and 210.54 trillion cubic feet of gas. It aims to produce three million bpd of oil and 12 billion standard cubic feet of gas daily.
Through lower costs and expanded capacity, Nigeria seeks to attract record investments and strengthen its role in the global energy market.