Nigeria’s oil giant remits $2.1billion as oil reforms boost revenue in 2026

Nigeria’s state oil company, the Nigerian National Petroleum Company Limited (NNPC Ltd), remitted N2.89 trillion ($2.11 billion) to the Federation Account in the first quarter of 2026, as sweeping reforms begin to lift government revenue from the oil sector.

• Nigeria’s NNPC remitted $2.1 billion in Q1 2026 as new reforms improved revenue collection.
• March profit rose 49%, driven by stronger gas output and steady operations.
• Policy changes are forcing higher remittances and reducing deductions.
• But oil production remains below target, and supply challenges persist.

The payments mark one of the clearest signs yet that recent policy changes aimed at tightening transparency and blocking leakages are starting to take effect.

Monthly remittances rose from N726 billion ($530 million) in January to a sharp N1.804 trillion ($1.32 billion) in February, before easing in March, bringing the quarterly total to N2.89 trillion.

The February spike suggests improved reconciliation of prior revenues and stricter remittance enforcement, rather than a one-off surge in production.

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Profit rebounds as revenue strengthens

NNPC reported a profit after tax of N276 billion ($201 million) in March, up about 49 per cent from N136 billion ($99 million) in February.

Revenue climbed to N2.774 trillion ($2.02 billion), compared with N2.68 trillion in the previous month.

The recovery points to stronger operating margins and improved efficiency across the company’s upstream and gas businesses after a softer February performance.

Gas emerges as key growth driver

Natural gas output continued its upward trend, rising to 7,731 million standard cubic feet per day (mmscfd) in March, the highest level recorded in the past year.

That compares with 7,458 mmscfd in February and 7,283 mmscfd in January.

Gas sales also increased to 5,059 mmscfd, reflecting stronger domestic demand and ongoing efforts to deepen gas commercialisation.

The gains highlight Nigeria’s growing reliance on gas as a more stable and scalable revenue stream, particularly as global energy markets shift toward cleaner fuels.

Oil output stable but still below target

Crude oil and condensate production averaged 1.56 million barrels per day in March, slightly above February’s 1.51 million bpd.

Of this, crude oil accounted for 1.32 million bpd, while condensate contributed 0.24 million bpd.

Despite the improvement, output remains significantly below Nigeria’s long-standing target of more than 2 million bpd, limiting the country’s ability to fully benefit from oil price movements.

Crude sales fell to 17.27 million barrels in March from 23.08 million barrels in February, pointing to continued export or logistical constraints.

Policy reforms reshape revenue flows

The improved remittance performance follows a February 2026 executive order signed by President Bola Tinubu aimed at overhauling oil revenue management.

The directive: Suspended NNPC’s management fees and frontier exploration deductions; Mandated full remittance of oil and gas revenues; Introduced stricter oversight through an inter-agency committee.

The changes mark a shift from a system where the national oil company retained significant portions of revenue to one with tighter fiscal controls.

Infrastructure advances, but supply gaps remain

NNPC reported progress on key gas infrastructure, including the Ajaokuta-Kaduna-Kano (AKK) pipeline, where the spur line to the Gwagwalada power plant has been completed.

The Obiafu-Obrikom-Oben (OB3) pipeline recorded 96 per cent availability, supporting improved gas supply reliability.

However, downstream challenges persist.

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Petrol availability at NNPC retail stations stood at 56 per cent in March, underscoring ongoing distribution and supply constraints in parts of the country.

NNPC’s stronger remittances are critical for Nigeria’s public finances, where oil revenue remains a major source of funding for federal, state and local governments.

The company remitted about N14.7 trillion ($10.7 billion) in 2025, and current trends suggest 2026 could see sustained high inflows if reforms hold and production improves.

Nigeria is improving revenue transparency and cash generation, but still faces structural constraints in oil production and distribution