Nigeria’s Oil Output Dips as FG Tightens Rules for Licensing Round

Nigeria’s crude oil production declined slightly in December, trailing the performance of several other members of the Organisation of Petroleum Exporting Countries (OPEC) at a time when falling global oil prices are increasing pressure on oil-dependent economies.

Data from OPEC’s January 2026 Monthly Oil Market Report show that Nigeria produced an average of 1.422 million barrels per day (bpd) in December, down from 1.436 million bpd in November. The 14,000 bpd month-on-month drop, based on direct communication with member countries, marks a setback to the country’s fragile production recovery.

Although the decline appears modest, analysts note that it is significant, as Nigeria’s output remains about 400,000 bpd below the benchmark set in the 2026 federal budget. The country also struggled to meet its 2025 production target of 2.06 million bpd, ending the year at around 1.4 million bpd, more than 600,000 bpd short of budget assumptions.

In contrast, several OPEC members recorded production gains during the same period. Saudi Arabia increased output by 34,000 bpd, Iraq by 72,000 bpd, Kuwait by 11,000 bpd and the United Arab Emirates by 10,000 bpd, highlighting Nigeria’s relative underperformance within the cartel.

Meanwhile, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has rolled out stringent technical, financial and compliance requirements for bidders participating in Nigeria’s 2025 oil and gas licensing round. The commission warned that only realistic, well-funded and executable proposals would be considered for licence awards.

According to NUPRC, bid evaluations will be strictly based on technical capacity, financial strength and the ability to deliver proposed work programmes. Commitments made during the bidding process, it said, will be binding and form the basis for post-award regulatory oversight.

At its 2025 oil and gas licensing pre-bid conference, the commission also pledged faster and more predictable regulatory approvals, improved production security, credible licensing processes, and world-class safety and governance standards. These measures, it said, signal a renewed push for efficiency, accountability and measurable outcomes in Nigeria’s upstream sector.

The tougher bid terms were announced as the Minister of Petroleum Resources (Oil), Heineken Lokpobiri, declared that the federal government would no longer tolerate speculative acquisition of petroleum licences. He stressed that oil and gas assets should not be treated as status symbols.

Lokpobiri noted that petroleum licences remain the property of the Federal Government and are issued strictly for development within defined timelines. Licences held without execution, he said, add no value to investors or to the Nigerian economy.

The minister added that investors would be judged solely on clear criteria, including technical competence, financial capacity and the ability to fulfil commitments made during the licensing process. He warned that the era of holding assets purely for speculation “is gone forever” in Nigeria.

He also made it clear that the government would not entertain requests for refunds, asset swaps or discretionary remedies after bids had been concluded, stressing that such practices are not recognised under Nigerian law.