Nigeria has set a target of producing 2.6 million barrels per day (bbl/d) of oil and condensates by 2026. This is a significant jump from the current production levels of around 1.6 million bbl/d in 2023.

The country has been facing challenges in its oil production due to crude theft and pipeline vandalism in the Niger Delta region, as well as low investment in the sector. As a result, government revenue has been impacted. In response, President Bola Tinubu’s government has been working to attract more investment in the sector.

According to President Bola Tinubu’s government, oil majors have committed to investing $13.5 billion in the short term following meetings with senior executives from TotalEnergies, Shell, and Exxon Mobil.

To achieve its production target, the the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has outlined a 2024–2026 action plan. This includes directing the development of oil assets to areas less prone to theft and vandalism, as well as providing regulatory support for alternative crude oil evacuation routes. Oil firms will also require NUPRC approval for new pipeline routes.

The NUPRC expects oil production to increase from 1.8 million bbl/d this year to 2.6 million bbl/d in 2026. However, two of the three consultancies tasked by OPEC+ to verify Nigeria’s output said in November that the country was unlikely to reach its own production target this year.

Besides increasing production, the NUPRC is also working to reduce the cost of oil production down to $20 per barrel, from the current range of $25 to $40, by providing incentives to oil producers. The Commission will set up a framework for crude oil and gas transportation and/or handling costs based on a standardized tariff and implement an open access regime for upstream oil and gas pipelines and ancillary facilities, according to Reuters.

To attract more investment, the NUPRC also plans to reduce high signature bonuses, which are one-off fees paid to secure exploration blocks.