Nigeria aims to boost oil production with ExxonMobil deal

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Nigeria’s oil production could see a significant increase following a new agreement between the Nigerian National Petroleum Company Limited (NNPC) and ExxonMobil. This deal holds the potential to add an estimated 480,000 barrels per day (bpd) to the nation’s crude oil output.

The agreement marks a potential resolution to a disagreement surrounding the sale of ExxonMobil assets to Seplat Energy. This dispute, which began in 2022, reportedly caused Nigeria to lose around 480,000 bpd in production, costing the country millions of dollars daily.

On Thursday, the NNPCL confirmed it had signed a settlement agreement with ExxonMobil companies in Nigeria over the proposed divestment of a 100 per cent interest in Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited.

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This is coming barely 24 two days after President Bola Tinubu announced his intervention in the debacle between NNPCL and ExxonMobil hindering the sale of the assets to Seplat.

The Minister of States for Petroleum, Heineken Lokpobiri, said recently that Nigeria had lost about $30bn in the past two and a half years as a result of the unsuccessful divestment.

The minister expressed concerns that Nigeria was losing about 480,000 barrels of crude oil per day due to the Seplat/ExxonMobil crisis.

He said the asset was producing about 600,000bpd until the crisis began in 2022, saying the nation was losing millions of dollars daily.

According to the minister, the oil output from the asset dropped to 120,000bpd down from 600,000bpd since the disagreement began.

Lokpobiri said, “For the past two and a half years, oil has been hovering around $80 per barrel. 480,000bpd, multiply it by two and a half years, it will give you about $34bn. If one asset was doing about 600,000 barrels; but because of the problems which we are trying to resolve, production declined to 120,000 barrels, which means we’ve lost about 480,000bpd. Multiply it by $80, every day you get about $240m; multiply it by two and half years; we are talking of over $30bn. Inject that into our economy today, the dollar will naturally drop. This exchange rate is a matter of demand and supply”.