Nigeria’s oil output wobbles after 10yrs of increase in rigs
Nigeria’s Oil Output Declines as Rig Investments Fail to Boost Production
By Udeme Akpan, Energy Editor
Nigeria’s crude oil output is facing significant challenges, despite a decade of increased investment in oil rigs. A recent report highlights a staggering 20.8% year-on-year decline in production from five mature oil assets, falling to an average of 10,930 barrels per day (bpd) in June 2026, down from 13,794 bpd in June 2025. This trend raises concerns about the country’s capacity to sustain its influence within the Organization of the Petroleum Exporting Countries and the larger global oil market.
Despite a total of 2,099 rigs deployed across Nigeria’s oil fields between 2016 and 2026—reflecting investments in the billions—official records show stagnation in oil output since 2016, when rig counts peaked. Industry experts attribute this stagnation to declining production from aging wells, termed mature fields, coupled with slow development of new drilling sites.
In 2019, Nigeria achieved its highest production level in recent years at 1.734 million bpd, a figure that remains below the country’s annual budget expectations. Last year, production levels dropped further to an alarming 1.143 million bpd.
Data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) reveal that the Abo oil field, operated by Eni/Agip and producing since 2003, registered a dramatic 39.2% decline in output to 6,870 bpd in June 2026. Other fields, including Pennington and Ugo Ocha, also experienced steep declines, ranging from 45% to 16.6%.
Industry investigations across oil-producing states in Nigeria indicate significant depletion in many fields since the country’s first oil discovery in 1956. While some operators are taking steps to invest in new wells and workovers, others are unable to secure necessary capital, exacerbating the decline in production.
Responding to inquiries, Renaissance Africa Energy, operator of the Sea Eagle field, confirmed that the decline aligns with the natural progression of a mature asset. The company emphasized its commitment to exploring opportunities for production optimization and maintaining operational integrity.
Eni also acknowledged the challenge of maintaining production levels from its long-standing Abo field, citing ongoing optimization efforts and upgrades to gas compressors to enhance output.
As Nigeria grapples with internal production challenges, its influence in OPEC has waned. Once a formidable player with peak production near 2.5 million bpd in 2005, Nigeria has struggled to recover since the implementation of the Petroleum Industry Act (PIA) and other investment measures. Current output remains at about 1.7 million bpd, insufficient to meet OPEC quotas and domestic demand.
Recent OPEC+ meetings have underscored Nigeria’s limited capacity to leverage opportunities for increased production. Analysts warn that ongoing issues such as aging infrastructure, inadequate investment, and crude theft hinder the country’s ability to recover lost revenue.
Industry experts are calling for a multi-faceted approach to aid recovery, advocating for enhanced exploration, aggressive field development, and improved regulatory processes. They emphasize the necessity of addressing structural challenges that affect production and public revenue to optimize economic benefits from existing reserves effectively.
“The challenge is not simply increasing production, but maximizing economic recovery from existing fields,” said Wumi Iledare, Professor Emeritus of Petroleum Economics. “Actions should encompass regulatory incentives and technological enhancements to ensure that remaining resources contribute meaningfully to the economy.”
Addressing these issues could be crucial for Nigeria to reinvigorate its oil sector and restore its standing within the global market.
