By Abiodun Folarin
WorldStage– Nigeria’s state-owned energy giant, the Nigerian National Petroleum Company (NNPC) Limited, appears to be regaining operational momentum, posting a profit after tax of N462 billion in May 2026 as crude oil production climbed to 1.73 million barrels per day (mbpd) its strongest monthly performance in almost a year.
The latest Monthly Report on Wednesday, released by the company presents a picture of gradual recovery in upstream operations, improved asset reliability and growing gas production. However, beneath the encouraging figures lies a familiar reality: structural and operational constraints continue to prevent Africa’s largest oil producer from fully exploiting its hydrocarbon potential.
The report shows that NNPC generated N4.335 trillion in revenue during the month, while remitting N4.858 trillion in statutory payments to the Federation between January and May 2026, underlining the company’s continued importance as one of the Federal Government’s biggest revenue contributors.
The report also indicated an increase in crude oil and condensate production from 1.68 mbpd in April to 1.73 mbpd in May offers fresh evidence that ongoing efforts to improve asset uptime and operational efficiency are beginning to yield results after months of fluctuating output.
The company attributed the production increase largely to higher asset reliability. Yet it acknowledged that production remains below expectation because of persistent well performance issues, declining reservoir pressure at key offshore assets, lifting constraints and scheduled maintenance activities affecting major producing fields.
These disclosures reinforce concerns that Nigeria’s production challenge is no longer driven solely by crude oil theft and pipeline vandalism but increasingly by ageing infrastructure, reservoir management issues and technical bottlenecks that require significant investment to resolve.
The report indicates that NNPC is responding with targeted interventions aimed at improving well performance, reducing maintenance-related shutdowns, addressing lifting constraints and enhancing facility reliability to minimise production losses.
Equally significant is the continued growth in natural gas production, which reached 7,774 million standard cubic feet per day, the highest level recorded in the past 12 months. The improvement aligns with Nigeria’s broader strategy of positioning natural gas as the country’s transition fuel while expanding domestic industrial utilisation and export opportunities.
Although gas production improved, daily gas sales slipped marginally during the month, suggesting that market and infrastructure constraints continue to influence commercial offtake despite stronger production capacity.
The report also highlights substantial progress on Nigeria’s critical gas infrastructure projects. The Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline has reached 94 per cent completion, while the Obiafu-Obrikom-Oben (OB3) Pipeline stands at 97 per cent, with both projects moving into advanced pre-commissioning stages. Their eventual completion is expected to strengthen domestic gas supply, stimulate industrialisation and support power generation across the country.
However, one indicator that reflects continuing downstream supply challenges is the availability of Premium Motor Spirit (PMS) across NNPC Retail stations, which stood at only 57 per cent during the reporting period.
While the report does not elaborate on the reasons, the figure suggests that ensuring consistent nationwide fuel availability remains an operational priority despite improvements elsewhere in the value chain.
Beyond commercial performance, NNPC used the report to showcase its expanding corporate social investment initiatives, including the commissioning of a modern Magnetic Resonance Imaging (MRI) facility at the Nnamdi Azikiwe University Teaching Hospital, Nnewi.
The intervention is expected to improve access to advanced diagnostic services across Nigeria’s South-East and reflects the company’s growing emphasis on social impact alongside energy development.
Overall, the May performance suggests that NNPC is making measurable progress in restoring production and profitability.
Nevertheless, the report makes it equally clear that sustaining higher output will depend on how quickly the company can overcome longstanding technical constraints, optimise mature oil fields and complete strategic gas infrastructure projects that are central to Nigeria’s long-term energy security and economic growth.
