Nigeria’s Oil Output Slips to 1.51mbpd in February as NNPC Sends ₦1.804 Trillion to Federation Account

Nigeria’s Oil Output Slips to 1.51mbpd in February as NNPC Sends ₦1.804 Trillion to Federation Account

Nigeria’s oil industry posted a mixed February performance, with the Nigerian National Petroleum Company Limited reporting lower crude and condensate production even as it delivered a sharp rise in statutory payments to the Federation Account. In its February 2026 monthly report, NNPC said crude oil and condensate production fell to 1.51 million barrels per day, while statutory payments for the month reached ₦1.804 trillion. Revenue for the month stood at ₦2.68 trillion, profit after tax fell to ₦136 billion, gas production rose to 7,458 million standard cubic feet per day, and upstream pipeline availability was reported at 93 percent.

The figures place the company at the centre of two overlapping national debates: how quickly Nigeria can rebuild oil output after years of theft, sabotage and underinvestment, and how much of the sector’s earnings are now flowing directly into public coffers after President Bola Tinubu’s recent fiscal intervention. The February report showed production down from 1.64 million barrels per day in January, with NNPC attributing the decline to specific operational setbacks, including the outage of the Trans Forcados Pipeline because of integrity issues, start-up challenges at the Stardeep Agbami GTC 2 and 3 facilities after turnaround maintenance, delayed completion of the Sterling Oguali flow station, and ramp-up constraints from Enyie wells linked to sludge management problems.

The NNPC report is broadly consistent with official upstream regulatory data, though the two sets of numbers are not identical. The Nigerian Upstream Petroleum Regulatory Commission’s February production report put average daily combined crude oil and condensate output at 1,483,954 barrels per day, made up of 1,313,695 barrels per day of crude oil and 170,259 barrels per day of condensate. The regulator also said Nigeria’s average crude oil production represented 88 percent of its OPEC quota of 1.5 million barrels per day. The slight gap between the NNPC and NUPRC numbers appears to reflect separate reporting and reconciliation methods, but both point in the same direction: February was a weaker production month than January.

The NUPRC data gives a clearer picture of where the shortfall came from. Onshore and offshore streams showed uneven performance, but some of the biggest declines were striking. Bonga crude, one of Nigeria’s major offshore streams, fell from 3,701,453 barrels in January to just 56,625 barrels in February in the regulator’s monthly production table, while Anyala Madu, Nembe and several other streams also dropped sharply. At the same time, some streams such as Cawthorne rose, suggesting the system was not in general collapse but was instead hit by concentrated disruptions across key assets.

The revenue side of the story is more politically significant. NNPC’s ₦1.804 trillion statutory payment for February marked an unusually large transfer to the Federation Account and came just weeks after Tinubu signed an executive order changing how oil and gas proceeds are handled. Under that order, NNPC is no longer entitled to retain the 30 percent management fee on profit oil and profit gas revenues due to the federation, and it is also no longer allowed to collect and manage the 30 percent Frontier Exploration Fund previously carved out from those revenues. The presidency said all such proceeds are now to flow directly into the Federation Account.

That policy shift helps explain why NNPC’s remittance surged even as production fell and profit weakened. The company’s February profit after tax of ₦136 billion was far below the ₦385 billion reported in January, according to contemporary reporting based on the monthly summary, while its statutory payment jumped sharply. In effect, the state oil company is now passing through more money under the new fiscal rules, reducing the deductions it previously kept before remitting. That change is central to the Tinubu administration’s argument that public oil revenues had been weakened by embedded retention structures and that direct remittance would strengthen federal, state and local government finances.

The wider fiscal system has already begun to reflect those changes. At the March 2026 meeting of the Federation Account Allocation Committee, the three tiers of government shared ₦1.894 trillion from a gross total of ₦2.230 trillion for February. The Federal Ministry of Finance said the Federal Government received ₦675.086 billion, the states received ₦651.525 billion, local government councils got ₦456.467 billion, and oil-producing states received ₦110.949 billion as derivation. The ministry also said oil and gas royalty and excise duty increased significantly during the month, even though Petroleum Profit Tax, Hydrocarbon Tax, Companies Income Tax and VAT fell. 

For the oil market itself, however, the February production drop is a reminder that Nigeria’s old structural problems remain unresolved. Reuters reported in late February that Nigeria was preparing to export a new light sweet grade, Cawthorne crude, as part of efforts to raise output and diversify its export slate. It later reported that the first cargo had been shipped to the Netherlands in April, adding to newer grades such as Nembe and Utapate. But Reuters also noted that Nigeria’s crude output in March was still around 1.4 million barrels per day according to OPEC data, well below the country’s long-stated ambitions. 

Officials insist the February weakness was temporary. On April 3, the NUPRC said daily production had rebounded to 1.84 million barrels per day, with Commission Chief Executive Oritsemeyiwa Eyesan attributing the earlier dip to “unfortunate incidents” on strategic facilities and turnaround maintenance. NNPC, in a separate April 8 statement, said improved pipeline security had helped production rise from a historic low of 960,000 barrels per day in 2022 to an average of 1.71 million barrels per day and a peak of 1.84 million barrels per day in 2025. 

That leaves Nigeria with a familiar contradiction. The country is proving capable of generating large fiscal transfers from oil, especially after a redesign of the remittance rules, yet it is still struggling to hold production at levels consistent with its reserves, infrastructure and political promises. February’s report captured that contradiction precisely: lower output, weaker profit, stronger remittance. For now, the state is collecting more cash from the sector, but the deeper test remains whether Nigeria can convert temporary production recoveries into sustained barrels on the water.

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