NNPC Unveils Multi-Billion Dollar Savings as Major Oil Sector Reforms Gather Pace
Nigeria’s oil industry is witnessing one of its biggest transformations in years, with the Nigerian National Petroleum Company Limited (NNPC) announcing $3.4 billion in cost savings and N19.5 trillion remitted to the Federation Account within just 14 months. The achievements come as the Federal Government intensifies efforts to eliminate over 270 taxes, fees, and levies that industry stakeholders say have discouraged investment and slowed growth.
According to NNPC Group Chief Executive Officer, Bayo Ojulari, the $3.4 billion savings were achieved through contract restructuring and operational optimisation between April 2025 and July 2026. During the same period, government revenue from NNPC operations rose by 21.8 per cent, with total remittances reaching N19.5 trillion.
The company also recorded 100 per cent compliance with its joint venture cash call obligations from the 2025 financial year to June 2026. However, only six of its 27 joint venture partners fully met their funding obligations, while several others recorded partial or significant defaults, prompting NNPC to invoke provisions of the Joint Operating Agreements.
Operational performance also improved significantly. Crude oil production increased by six per cent year-on-year, while gas production rose by 8.1 per cent. Ojulari revealed that crude output currently stands at 1.71 million barrels per day, the highest level recorded in five years, with NNPCL Exploration and Production Limited (NEPL) reaching a record 365,000 barrels per day.
Gas production climbed to 7.5 billion standard cubic feet per day following the completion of the River Niger crossing on the Ajaokuta-Kaduna-Kano (AKK) Pipeline and the commissioning of the ANOH Gas Plant.
Ojulari also announced that NNPC has adopted a zero-tolerance policy toward joint venture partners that fail to meet their financial obligations, stressing that default clauses are already being enforced to ensure uninterrupted project funding.
Looking ahead, the national oil company identified seven strategic projects expected to drive future production and strengthen gas infrastructure through 2027. These include the UTM Floating LNG Project, the OB3 East-West Connector, the AKK Gas Pipeline, refinery enhancement programmes, the Zabazaba Deepwater Project, the Owowo Field, and the BSWAP Project.
Meanwhile, the Federal Government confirmed it has engaged PricewaterhouseCoopers (PwC) to benchmark Nigeria’s more than 270 oil and gas sector charges against international standards. The review is expected to simplify the country’s fiscal regime, reduce bureaucratic bottlenecks, and improve Nigeria’s competitiveness in attracting global investment.
Industry leaders welcomed the reforms but urged the government to move quickly. Independent Petroleum Producers Group (IPPG) Chairman Adegbite Falade warned that the large number of taxes, fees, and levies continues to threaten investment, particularly for smaller producers, and called for a harmonised, transparent, and investor-friendly regulatory framework.
Yawa9ja.
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