The Federal Government, through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), earned ₦5.21 trillion from crude oil, gas sales, and other upstream activities in the first half of 2025. The revenue represents 42.7% of the record ₦12.2 trillion generated in 2024 but only 34.7% of the ₦15 trillion target set for the year to fund the 2025 budget.
According to the commission’s latest report to the Federation Accounts Allocation Committee (FAAC), the earnings came from royalties, gas sales, flared gas penalties, and joint venture proceeds. This included ₦1.04 trillion from Nigerian National Petroleum Company Limited (NNPCL) joint venture and production-sharing contract royalty receivables, and ₦315.93 billion from the controversial Project Gazelle for January and March.
The NUPRC also noted that NNPCL’s cumulative JV royalty receivables between October 2022 and June 2025 stood at ₦6.6 trillion, reflecting delayed remittances from oil companies.
Confirming the 2025 revenue target, NUPRC Chief Executive Gbenga Komolafe said, “Last year, the commission surpassed its revenue generation by about 163%. This year, our target is ₦15 trillion. We are not intimidated — we have devised a strategic approach to achieve it.”
The report also showed that $459,226 was recovered from outstanding obligations, part of a $1.436 billion cumulative debt from crude oil lifting contracts. The balance of $1.435 billion remains unpaid.
At the current pace, mid-year earnings trail the proportional benchmark, raising concerns the annual target may be missed unless oil output rises and arrears are cleared faster.
Experts Caution Against Over-Taxing the Sector
Energy analyst Dayo Ayoade warned that turning NUPRC into a primarily revenue-generating agency could distort its regulatory mandate.
“While revenue is critical, regulators must balance this with creating a stable investment climate,” he said, adding that excessive fiscal pressure could push oil companies to friendlier jurisdictions.
Petroleum engineer Bala Zaka attributed the sector’s challenges to years of “business climate hostilities” — including sabotage, community extortion, and insecurity — which have driven many multinationals to East Africa.
He warned that indigenous firms taking over onshore and shallow-water assets are not aggressively exploring or increasing reserves, hurting production and government revenue.
Both experts urged the government to prioritise security, cut regulatory bottlenecks, and incentivise exploration to sustain revenue without stifling the sector’s future.
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