The Federal Government, through the Nigerian National Petroleum Company Limited (NNPCL), is embarking on an aggressive cost-optimisation drive expected to save the oil and gas sector between $3 billion and $4.5 billion in operational expenses by the end of 2025.
Speaking at the 50th anniversary celebration of the Nigerian Association of Petroleum Explorationists (NAPE) in Lagos, NNPCL Group Chief Executive Officer, Bayo Ojulari—represented by Executive Vice-President, Upstream, Udobong Ntia—revealed that the roadmap for cost reduction is already in motion, with a strong emphasis on efficiency, technology adoption, and infrastructure renewal.
“We have drawn up a roadmap to save about $3 billion by the end of December and aim to push that up to $4.5 billion by year’s end,” Ojulari said. “We’re focused on reducing cost per barrel and optimising technical and operational expenses without compromising output.”
Nigeria’s crude oil production has seen a remarkable rebound, climbing from 1.4 million barrels per day (bpd) in December 2024 to over 1.8 million bpd by July 2025—a 400,000 bpd surge in just seven months. This growth is attributed to industry-wide collaboration, improved security in oil-producing regions, and infrastructure milestones such as the 100% operational availability of the Trans-Niger Pipeline for the first time in years.
Ojulari also disclosed that the Bonga North project, expected to add 150,000 bpd to national output, is on track, further bolstering production capacity.
With much of Nigeria’s oil infrastructure ageing, Ojulari stressed the urgent need for facility renewal and maintenance.
“Most of our infrastructure is aged. We need to renew them, maintain them, and embed a strong maintenance culture to prevent recurring downtime,” he noted.
The NNPCL boss called for sustainable maintenance strategies and highlighted ongoing facility upgrade projects across major oil-producing hubs.
A key pillar of the NNPCL strategy is the adoption of artificial intelligence (AI), digital twins, and real-time monitoring systems such as SCADA to optimise production, improve safety, and reduce downtime.
“AI can help us make faster operational decisions and tweak well performance in real-time,” Ojulari explained. “Though initial costs are high, long-term savings and productivity gains will be substantial.”
He emphasised the role of digital solutions in subsurface monitoring, choke adjustments, and operational efficiency—critical to meeting both short- and long-term production targets.
The NNPCL is also targeting $30 billion in new oil and gas investments within the next two years, scaling up to $60 billion by 2030 in line with the Federal Government’s strategic energy roadmap. To achieve this, Ojulari urged stakeholders to adopt innovative financing models that ensure investor confidence and competitive returns.
“Investors are not driven by goodwill alone—they want clear margins. We must create an environment where funding flows seamlessly into projects,” he said.
Ojulari concluded by reaffirming NNPCL’s commitment to work closely with industry operators, regulators, and investors to maintain momentum.
“We don’t want to look back and regret missed opportunities. The time to act decisively is now,” he declared.
With a mix of cost optimisation, infrastructure renewal, technological innovation, and targeted investments, Nigeria is positioning itself to reclaim a stronger foothold in the global oil market. If executed effectively, the $4.5bn savings target and production surge could mark a turning point for the country’s petroleum sector, boosting revenues, creating jobs, and strengthening foreign exchange inflows.