Nigeria's Oil Sector Sees Significant Upswing in Rig Count, Production
Reports from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) indicate a substantial increase in Nigeria's oil rig count and a corresponding rise in crude oil production as of July 2025. This positive trend is attributed to a combination of policy reforms and targeted initiatives within the industry.
Rig Count Surges to 46:
Mr. Gbenga Komolafe, the NUPRC's Commission Chief Executive (CCE), announced that Nigeria's oil production rig count has dramatically increased from just 8 in 2021 to 46 by July 2025. This represents a 475% increase over four years and a 48% rise within the first seven months of 2025 alone. The growth reflects intensified upstream activities across land, swamp, and offshore terrains, with three rigs currently operating in deepwater locations. The rig count is a key indicator of activity levels within the oil and gas sector.
Production on the Rise:
The NUPRC indicates that the 46 active rigs are currently driving Nigeria's oil production. While official average production figures for July 2025 are still being compiled, recent statements highlight an upward trajectory:
The Nigerian National Petroleum Company Limited (NNPCL) reported current oil output, including condensates, has risen to 1.63 million barrels per day (bpd) as of July 11, 2025. The NNPCL aims to reach 1.9 million bpd by the end of 2025 and achieve a capacity of 2 million bpd by 2027.
Earlier in July, the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, stated Nigeria's current production at approximately 1.745 million bpd, targeting two million bpd by year-end.
The NUPRC itself had set a target of at least 2.1 million bpd by 2025.
The "Project One Million Barrels" initiative, launched by NUPRC in October 2024, has already contributed 300,000 barrels of oil per day to national production, with an annual goal of adding an additional one million barrels.
Factors Driving Growth:
Several factors are credited for this positive momentum:
Petroleum Industry Act (PIA) 2021: The PIA is consistently cited by NUPRC as a primary driver, providing a clearer regulatory framework aimed at attracting investment.
Executive Orders: President Bola Tinubu's Executive Orders 40, 41, and 42 are highlighted for introducing tax incentives, tax remissions, and redefining contracting cycles and thresholds, which have reportedly attracted billions of dollars in Final Investment Decisions (FIDs).
NUPRC Initiatives: The NUPRC's commitment to increasing oil production, particularly through programs like "Project One Million Barrels," is playing a significant role.
Combating Oil Theft: Ongoing efforts, including surveillance contracts with private security firms and enhanced community involvement, have reportedly curtailed crude oil theft and pipeline vandalism, facilitating increased crude delivery to terminals.
Increased Investment: An estimated $8 billion in investments between 2022 and 2025 has financed the drilling of 236 wellbores, directly contributing to the boost in drilling activity and production capacity.
Technological Advancements: The adoption of advanced digital technologies, including AI, drones, and blockchain, is improving efficiency and transparency in exploration and extraction.
Indigenous Company Participation: Increased involvement of local companies acquiring onshore assets from International Oil Companies (IOCs) is enhancing prospects for sustained production and strengthening community relations.
This upward trend in rig count and production signals a renewed effort to revitalize Nigeria's oil and gas sector and enhance national revenue. Challenges such as aging infrastructure and the global energy transition remain relevant considerations for the sector.
