The expectation of the Federal Government of Nigeria clinching a daily crude oil output of 2 million barrels per day by the end of December, 2024 might become impossible if the nation’s oil rigs continue to drop.
Nigeria, which holds the title of Africa’s largest oil producer, is struggling to improve on its crude oil production margin.
The target appears to be a tall order as recent report has revealed that Nigeria’s functional oil rigs have experienced a 27 percent sharp drop.
An oil rig/platform is a large structure that houses facilities for extracting and processing petroleum and natural gas from rock formations beneath the seabed.
The rig count reflects the level of exploration, development, and production activities in a country’s oil and gas sector. Active oil exploration attracts investment and revenues into the country for economic growth.
According to the latest data from the November 2024 Monthly Oil Market Report of the Organisation of Petroleum Exporting Countries (OPEC), the number of avtive oil drilling rigs across Nigeria reduced to 11 in October.
OPEC data further revealed that the country operated an average of 17 in the first quarter of 2024. Nigeria also struggled to maintain the 17 oil rigs in the second quarter of the year.
However, in the third quarter of 2024, the data showed that Nigeria was left with only 14 crude oil rigs.
The federal government believes that increase in crude oil production is the shortest means of pulling the nation out of its current economic doldrums.
To this end, Nigeria’s Minister of State for Petroleum, Heineken Lokpobiri disclosed plan to hit the target of 2 million barrels per day in December this year so that Nigerians’ economic hardship could be abated.
As of November 2024, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mele Kyari, had claimed that Nigeria revved up output, producing 1.8 million bpd of crude oil and gas, adding that the nation produced 7.4 standard cubic feet per day.
However, OPEC’s latest oil market report revealed that Nigeria’s crude oil production recorded an average of 35,000 barrels increase in crude output in October, rising to 1.434 million barrels per day.
The report pointed out that production rose from 1.399 million bpd in September, according to secondary data from Nigerian authorities.
Direct communication showed that Nigeria’s average crude oil production for October was 1.333 million bpd, an increase of 9,000 barrels compared to 1.324 million bpd in the previous month.
Experts and stakeholders have experienced displeasure over the report, noting that it may worsened investors flight in the country.
For the Executive Chairperson of the African Energy Chamber, NJ Ayuk, said Nigeria used to witness big oil and gas investments, adding that the nation has been losing investors to Namibia, Ivory Coast, Angola and the Republic of Congo as the country’s previously Bright spot on the sector has significantly dimmed.
The National Bureau of Statistics (NBS) revealed that the country’s foreign capital investments in the industry fell from $720 million in 2016 to $3.64 million by 2023.
According to the report, the petroleum industry received nothing from the $3.38 billion in capital imports into Nigeria during the first three months of 2024.
