NNPC SENDS ₦7.9TN TO FEDERATION ACCOUNT AS OIL OUTPUT SLIPS AND OB3 TARGET FACES DELAY

The Nigerian National Petroleum Company Limited has remitted a total of ₦7.913 trillion in statutory payments to the Federation Account between January and July 2026, despite a decline in the company’s crude oil and condensate production during July.

The latest figure was contained in NNPC’s July 2026 Monthly Report Summary released on Wednesday. It represents an increase of ₦1.627 trillion over the ₦6.286 trillion the national oil company had remitted to the Federation Account between January and June.

NNPC’s July performance also showed strong financial results, with the company reporting ₦3.087 trillion in revenue and ₦279 billion in profit after tax during the month. The figures indicate that the company maintained substantial financial contributions to government coffers even as operational difficulties affected its petroleum production.

The remittances come against the backdrop of the Federal Government’s efforts to ensure that petroleum revenues due to the federation are transferred directly into the Federation Account. President Bola Tinubu had earlier directed through Executive Order 9 that such revenues should be remitted directly, as part of measures aimed at protecting public revenue and strengthening fiscal stability.

However, NNPC’s financial performance was accompanied by a decline in crude oil and condensate output. Production dropped by approximately 2.3 per cent, from 1.72 million barrels per day in June to 1.68 million barrels per day in July.

The July figure consisted of approximately 1.44 million barrels per day of crude oil and 240,000 barrels per day of condensate. This compared with 1.47 million barrels per day of crude and 250,000 barrels per day of condensate recorded in June.

NNPC attributed the reduction to operational challenges affecting several production assets. According to the company, facility outages, equipment unavailability, pipeline incidents and other production constraints contributed to the weaker July output.

The decline came shortly after Nigeria recorded an improvement in oil production. The Nigerian Upstream Petroleum Regulatory Commission had reported June crude production of about 1.56 million barrels per day, described as the country’s highest level since April 2020. Combined crude and condensate output during that period was approximately 1.735 million barrels per day.

NNPC said it would continue efforts to improve production by maintaining higher facility availability, carrying out preventive maintenance and reducing unplanned downtime. The measures are expected to help minimise disruptions and support more consistent output from the country’s petroleum assets.

Meanwhile, attention has also shifted to the long-awaited Obiafu-Obrikom-Oben, or OB3, gas pipeline, after the project appeared to miss the August 2026 target previously announced for the commencement of first gas.

NNPC had stated in its July report that the OB3 pipeline had achieved 100 per cent availability and that pre-commissioning activities at the Niger River Crossing had been completed. The company had nevertheless projected that first gas from the pipeline would begin in August.

With September now underway, however, the company has not publicly confirmed that gas transmission has commenced through the pipeline or announced a new commissioning date. This has raised fresh questions about the remaining steps required to bring the long-delayed project fully into operation.

The development is particularly notable because the completion of the Niger River Crossing in April was regarded as a major milestone for the OB3 project. The latest situation has therefore generated renewed interest in whether additional technical or commissioning work remains before the pipeline can begin full-scale gas transmission.

The OB3 pipeline is expected to play an important role in Nigeria’s gas infrastructure once fully operational. Its delayed start, alongside the latest production disruptions, underscores the operational challenges still confronting the country’s oil and gas sector even as NNPC continues to make significant financial contributions to the Federation Account.

Overall, NNPC’s July report presents a mixed picture: the company delivered substantial revenue and statutory payments to government, but lower petroleum production and uncertainty surrounding the OB3 first-gas timeline remain important issues for Nigeria’s energy sector.