<\/p>\n
Nigerian oil companies are plowing windfall gains from the Iran-war crude rally into near-term extraction projects, boosting the drive by Africa\u2019s top producer to double output within four years.<\/p>\n
Dozens of small and mid-sized firms that produce less than 50 000 barrels per day have spent years snapping up assets shed by international oil companies. Now they\u2019re capitalising on supply constraints caused by the effective closure of the Strait of Hormuz \u2014 a conduit for a fifth of the world\u2019s crude and gas supplies \u2014 by lifting output.<\/p>\n
\u201cIt\u2019s good planning meeting opportunity,\u201d said Wisdom Enang, a former manager at Exxon Mobil Corp in Nigeria. Production volumes from the small producers could add 200 000 to 300 000 barrels per day before the end of the year, he said.<\/p>\n
Nigeria\u2019s production is already on an upward path, rising to 1.6 million barrels a day in April \u2014 the biggest monthly increase in almost three years, according to data compiled by Bloomberg.<\/p>\n
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Production is increasing after Nigerian President Bola Tinubu took steps to attract investment into an industry long hobbled by aging infrastructure, theft and vandalism. The measures include a policy revamp that added tax incentives and streamlined contract approvals, along with an overhaul of the leadership at the state-owned oil company.<\/p>\n
Still, oil prices at $100 a barrel and higher are the biggest factor driving domestic producers including Oando Energy Resources, which bought assets from Italian major Eni SpA in 2024.<\/p>\n
After a surge in revenue, the company plans to drill new wells to boost output 30% to 42 500 barrels a day by the end of the year, Chief Executive Officer Wale Tinubu said in an interview. It\u2019s also bringing forward a five-year plan to double production in order to \u201ccapture the demand shortfall that has been created by this conflict,\u201d he said.<\/p>\n
Local producers have a strong investment case to increase output at current prices, said Ahonsi Unuigbe, CEO of Petralon Energy. Along with Oando\u2019s Tinubu, he\u2019s seeing increased interest from Middle East investors.<\/p>\n
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The conflict started two weeks after Petralon drilled a second well. With oil prices shattering its base case projection of $65 per barrel, the company brought forward plans to drill a third. That will increase its output 56% to 7 500 barrels a day before year end, according to Unuigbe.<\/p>\n
Pan Ocean Oil Corp and the Newcross Companies, which form an entity that produces 48 000 barrels per day, has resuscitated two wells since the war started and plans to inject the cash into growth projects and paying down debt.<\/p>\n
The war\u2019s impact \u201chas been materially positive,\u201d said Oluseyi Oladapo, finance director at the company.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#Iran #war #oil #disruption #prompts #Nigeria #producers #lift #output<\/p>\n","protected":false},"excerpt":{"rendered":"
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