Presidency sets stage for major NNPC shake-up over weak oil output

The Federal Government has indicated that it may restructure the Nigerian National Petroleum Company Limited (NNPC) as part of plans to reverse the country’s declining oil production.

Special Adviser to the President on Energy, Olu Verheijen, speaking Monday at the Nigerian Association of Petroleum Explorationists (NAPE) Conference in Lagos, said Nigeria cannot meet its target of producing three million barrels of crude per day if NNPC continues to operate under its current asset and funding model.

Verheijen disclosed that NNPC’s upstream arm, NNPC E&P Limited (NEPL), contributes only about 220,000 barrels of oil per day – less than 10 percent of national output – and lacks the financial capacity to sustain the large-scale drilling campaigns needed to boost production.

“Joint venture partners can no longer shoulder NNPC as they did in the past,” she said. “We must decide whether NEPL can deliver growth on its own balance sheet. If not, we must restructure asset ownership and allow operators with the technical competence, capital depth and governance discipline to step in.”

She argued that Nigeria’s indigenous producers must shift from marginal field interventions to major greenfield projects capable of lifting national output, noting that the government’s reform agenda is anchored on four key priorities: reserves, revenues, reliability and responsibility.

According to her, the Tinubu administration has already unlocked more than $8 billion in new oil and gas investments, with a pipeline of roughly $20 billion more expected, particularly in deepwater and gas development.

NNPC Chairman Ahmadu Kida, who also addressed the conference, said the company was committed to transformation and collaboration, maintaining that NNPC would become “Africa’s uncontested energy company” within five years.