…Oil & Gas Sector Reforms Boost Export Earnings By $1.18bn
The federal government’s earnings from the export of crude oil and gas increased in January 2025, driven by increases in both crude oil price and domestic production.
Data from the Central Bank of Nigeria showed that aggregate receipts from crude oil and gas export increased to $4.80bn, from $3.62bn in December 2024.
The increase of $1.18bn was on account of the rise both in crude oil prices to $80.76 pee barrel from $74.72 pee barrel in the preceding month and domestic crude oil production to 1.54 million barrels per day, from 1.48mbpd in December 2024.
A breakdown indicated that crude oil export receipts rose to $3.86bn, from $2.68bn. Similarly, gas export earnings also increased to $0.95bn, from $0.94bn in December 2024.
Recall that last year, the Nigerian Upstream Petroleum Regulatory Commission launched an aggressive plan to increase Nigeria’s oil production by 1 million barrels per day.
To achieve this, the NUPRC has successfully opened up the country for investment with the successful bid rounds which would allow increased oil production.
NUPRC’s 2024 bid round saw 25 winners emerge after a competitive bidding process. Major winners included Petroli Energy Marketing & Supply Limited (PPL 269), Sahara Deepwater Resource Limited (PPLs 270 and 271), Panout Oil and Gas Limited (PPL 300/301-CS), and TotalEnergies E&P Nigeria (PPL 2000/2001).
The round focused on fallow assets and aimed to boost Nigeria’s energy production.
President Bola Ahmed Tinubu has been driving new projects in the oil and gas industry through the Presidential Executive Orders on Oil & Gas Reforms.
The Presidential Executive Orders are targeted at unlocking up to $2.5bn in new oil and gas investments in the country.
These Executive Orders, signed on February 28 last year, put in place, fiscal incentives for certain types of non-associated gas projects, reduce contracting costs and timelines in the sector, and obliterate any leakages impacting the compliance with local content requirements within the Nigerian oil and gas sector.
Similarly, the Petroleum Industry Act, 2021 which provided fiscal incentives for investors is creating the enabling environment that has rekindled hope in the energy sector.
The fiscal incentives provided by the President through the Executive Orders have enabled the take-off of the $550m upstream gas project between the NNPC Ltd and TotalEnergies on the development of the Ubeta field.
The Ubeta field, which was discovered in 1964, is located northwest of Port Harcourt, Rivers State.
Non-oil export earnings have also increased in January 2025, majorly resulting from higher receipts from the export of agricultural commodities, as government initiatives continued to yield positive outturns.
The CBN Report added that Non-oil export earnings rose to $0.56bn, from $0.54bn in the preceding month.
The development was on account of the positive effects of government initiatives such as Export 35 redefined and the Go Global, Go for Certification.
Analysis by direction of trade revealed Netherlands as the major destination for Nigeria’s non-oil export products accounting for 23.39 per cent of total.
This was followed by Belgium (13.83 per cent), Brazil (11.33 per cent), India (9.47 per cent), Germany (4.91 per cent), and China (4.66 per cent).
By products, the major commodities exported were cocoa beans, which represented the largest share at 46.26 per cent, followed by urea (23.06 per cent), sesame seeds (6.97 per cent), cocoa products (4.59 per cent), copper (1.93 per cent), and aluminium (1.71 per cent).
Receipts from the top five non-oil exporters increased to $0.33bn, from $0.25bn in December 2024.
