By Muhammad Mamman
The Nigerian National Petroleum Company Limited (NNPC) is launching an ambitious plan to slash oil production costs by $4.5 billion by December 2025, partnering with international and domestic oil producers to boost efficiency and unlock billions in savings. The bold initiative, announced during the Nigerian Association of Petroleum Explorationists’ (NAPE) 50th anniversary in Lagos, could see $3 billion saved this year alone, with even greater reductions on the horizon.
Udobong Ntia, NNPC’s Executive Vice President for Upstream, unveiled the strategy, emphasizing a sweeping re-engineering of operations to drive down costs. “In just six months, we’ve identified $3 billion in savings,” Ntia said. “Our next milestone is hitting $4.5 billion by year-end, creating more value for the sector.”
Nigeria’s oil production costs, ranging from $20 to $40 per barrel, rank among the world’s highest, driven by hefty taxes, levies, security challenges, and intermediary fees. In contrast, global averages are significantly lower, making NNPC’s cost-cutting push critical to staying competitive.
The initiative aligns with President Bola Tinubu’s vision to attract $30 billion in oil and gas investments over the next two years, with an ambitious goal of doubling that to $60 billion by 2030. To achieve this, NNPC is optimizing operations across deepwater, shallow offshore, land, and swamp fields, signaling a transformative shift for Nigeria’s oil industry.
This aggressive cost-reduction strategy could reshape Nigeria’s energy sector, positioning it as a global leader in efficiency and investment.
