In this article we discussed on what FG. said about oil earnings: which rose by n450bn in two months and how it can be beneficial to investors.
The Federal Government, through the NUPRC, recently announced a new crude oil production target for Nigeria of 2.5 million barrels per day, in a bid to grow the foreign exchange fortunes of the country. The Chief Executive, NUPRC, Gbenga Komolafe, had said, “The commission has been working assiduously to ensure that the Petroleum Industry Act is effectively implemented for growth in oil and gas reserves as well as achieving the national average daily production target set at 2.5 million barrels of oil and condensate per day in the near term.
“The oil and gas reserves in Nigeria represent 30 per cent and 34 per cent of the African oil and gas reserves respectively. Our vast reserves hold immense potential for sustainable development and prosperity. “Although the actual national production currently averages 1.33 million barrels of oil per day and 256, 000 barrels of condensate per day, the national technical production potential currently stands at 2.26 million bpd while the current OPEC quota is 1.5 million bpd.”
Read: NIGERIA’S ECONOMIC GROWTH SURPRISES AS OIL SECTOR SLUMP ENDS
Benefits to Investors
He noted that closing the gap between the actual oil production and the technical potential presents a window of investment opportunities for investors and a significant opportunity for Nigeria to unlock additional revenue streams, address the current foreign exchange gap and strengthen economic resilience. Komolafe stated that aside from hydrocarbon resources, Nigeria is blessed with potentials for green and blue hydrogen, solar, wind, biomass and critical minerals for development of clean energy technologies as well as growing population predominated by young people. “With a coastline along the Gulf of Guinea, a market size of more than 200 million people projected to reach between 390 million and 440 million people in 2050, Nigeria represents hope for Africa.
Oil Earnings Rise by N450bn In Two Months, Says FG
Crude oil earnings increased by N449.93 billion during the months of December 2023 and January 2024, according to the latest information available. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is yet to release oil production figures for February 2024. However, data so far indicates a consistent upward trend in Nigeria’s oil output during December 2023 and January 2024.
Read: Bringing NUPRC closer to oil and gas operators will boost efficiency
The upstream oil sector regulator stated that the daily crude oil production in December 2023, (excluding condensates) saw a notable increase of 3.88 million barrels compared to the previous month. With the average cost of Brent crude at $77.63 per barrel, this boost in production translated to an additional $301.2 million, equivalent to N244.79 billion at the official exchange rate of N812.7/$ in December 2023. Further, January 2024 witnessed an additional 2.81 million barrels, while with condensates it was 1.64 million barrels of crude oil production compared to December 2023, with Brent crude averaging at $80.12 per barrel. Consequently, the Federal Government increased its crude oil earnings by $225.14 million in January, equivalent to N205.14 billion at the average official exchange rate of N911.19/$.