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By Adewale Sanyaolu
In an unusually frank conversation at the Nigerian International Energy Summit (NIES) 2026 in Abuja last week, NNPC Ltd’s Group Chief Executive Officer, Engr. Bayo Ojulari, laid bare the structural weaknesses undermining Nigeria’s oil industry.
From chronic under-investment and vulnerable pipelines to stalled refinery performance, gas pricing distortions and a reset in relations with the Dangote Refinery, Ojulari’s remarks offered a rare insider’s view of the pressures confronting the nation’s energy sector.
He revealed how the national oil company is navigating rising expectations under the Petroleum Industry Act (PIA).
As known by industry stakeholders, Nigeria’s oil and gas sector has long been defined by a gap between ambition and execution.
Over the years, successive administrations announced production targets, refinery revamps and reform agendas that often struggled to survive operational reality.
The passage of the Petroleum Industry Act (PIA) in 2021 was designed to change that trajectory by resetting governance, clarifying roles and transforming the national oil company into a commercially driven entity. But laws alone do not fix aging assets, declining reservoirs or decades of deferred investment.
Nine months into a new leadership phase, Ojulari says the company is confronting the structural weaknesses left behind by years of under-investment and operational fragility.
He offered an assessment of what it will take to stabilise production, restore credibility and reposition Nigeria’s oil and gas sector for sustainable growth.
Oil production amid worsening security challenges
Security is a major factor, but it is not the whole story. Pipeline security was necessary, but it was not sufficient to raise production sustainably. Nigeria’s production system is inherently fragile. You cannot blink, not even for a day, because even a short disruption can shut in volumes that take months to recover.
The Niger Delta challenge is not purely criminal; it is deeply social and historical. Once we placed communities at the centre of security arrangements, reliability improved.
Communities must see themselves as stakeholders in the system, not as bystanders or adversaries. When they benefit from stability, they help protect infrastructure. That shift has reduced incidents and improved uptime, but again, it is only one part of the solution.
What improved security has done is to reduce losses and stabilise operations. However, stability does not automatically translate into growth. Growth comes from drilling, well workovers, facility upgrades and reservoir management. Those activities require sustained investment, technical discipline and time.
Constraints
The real constraint today is under-investment. Nigeria is now confronting the consequences of years of capital starvation in the upstream sector. Oil and gas assets are not static. Reservoirs decline naturally, facilities age, and equipment deteriorates.
When investment is delayed year after year, the impact compounds. Wells that should have been worked over are left idle. Facilities that require upgrades continue operating below capacity. Eventually, production declines—not because the resource is gone, but because the system is worn out.
Fragility of Nigeria’s oil production system
It is extremely fragile. A single technical failure, community dispute or operational shutdown can remove significant volumes from the system. Restarting production is rarely immediate. Pressure regimes change, facilities degrade further, and confidence is shaken.
This is why we emphasise realism. Production is not something you announce at a press conference; it is something you sustain daily through disciplined operations, adequate funding and constant attention to detail.
We are separating political aspiration from operational reality. A credible production plan is more valuable than an ambitious headline number that cannot be delivered.
For the first time, Nigeria’s medium-term production plan submitted to OPEC is based on NNPC Ltd internal technical assessments rather than externally imposed targets. Those shifts matter because it allows planning to reflect what assets can realistically deliver within specific timelines which further strengthens credibility.
OPEC discussions are technical and data-driven. If a country repeatedly overstates capacity and underperforms, it weakens its negotiating position.
By presenting realistic baselines and transparent investment assumptions, Nigeria can engage more effectively with OPEC and plan gradual, sustainable increases tied to actual project execution.
Update on refinery operations
Honesty is necessary if progress is to be made. The refineries, as they were operating, were destroying value for Nigeria. That is not a political statement; it is a financial reality supported by years of losses.
Turnaround maintenance alone does not make refineries work. Financing alone does not make refineries work. Contractors alone do not make refineries work. What makes refineries work are competent, experienced operators with clear incentives to perform.
The absence of world-class operators with skin in the game left our refineries in ruins. Refining is a continuous, complex operation that requires discipline, expertise and accountability. Without those elements, even well-funded refineries will struggle.
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Ownership was never the core problem. The performance was. Without proper operating models, refineries become cost centres rather than value creators.
So, for now, we are redefining our role. We are open to partnerships where capable operators manage assets efficiently and transparently. The focus is on value creation, not control.
If an arrangement delivers reliable output, meets quality specifications and operates commercially, it serves Nigeria’s interest, regardless of who holds majority ownership.
Whether people love or hate Dangote, it is a Nigerian refinery that works. The Dangote Refinery gave Nigeria breathing space, particularly in stabilising domestic fuel supply.
Our strategy is collaboration, not competition for its own sake. Efficient refineries strengthen the system. The objective is energy security, not institutional rivalry.
Dangote Refinery’s influence in the downstream market
Markets respond to efficiency. Influence follows performance. The solution is not to weaken efficient operators, but to enable more efficiency across the system so competition can emerge naturally.
Regulation should ensure fairness and transparency, but efficiency must be rewarded. That is how markets develop depth and resilience.
Fuel import
Until domestic refining can reliably meet demand, imports will remain part of the supply mix. The focus is to reduce dependence over time through performance, not rhetoric.
This is because installed capacity is not the same as operational capacity. What matters is what refineries can consistently produce, at scale, to specification and at competitive cost.
Domestic gas supply
This is Nigeria’s gas paradox. Some domestic gas customers already pay more than LNG export prices. That tells you the issue is not resource availability, but infrastructure, pricing structure and execution.
Gas requires pipelines, processing facilities and commercial clarity. Without those, molecules remain stranded regardless of how abundant they are underground.
We are treating the Gas Master Plan as an execution document, not a policy wish list. The emphasis is on delivering infrastructure, improving pricing transparency and connecting supply to demand.
Nigeria’s gas future cannot be held hostage by delays. Gas is critical for power, industry and exports, and it must be treated as such.
Gas is Nigeria’s transition fuel. It supports industrialisation, power generation and export earnings while reducing emissions compared to other fossil fuels.
The transition must be pragmatic. Nigeria cannot abandon its comparative advantages. Gas allows us to balance development needs with global climate considerations.
Culture change in NNPC Ltd
Transformation is not about documents; it is about people, systems and culture. Culture eats strategy for breakfast. There is world-class talent inside NNPLC. What was missing historically was consistent leadership, accountability and alignment with commercial outcomes.
Cultural change is slow and uncomfortable. It requires clarity of purpose, transparency and consequences for performance. But without it, no reform, legal or operational, can succeed.
How PIA is driving new thinking at NNPC
The PIA makes NNPC Ltd a commercially driven company. That changes how we invest, how we measure success and how we relate to the government.
We are no longer a policy instrument. We are a company that must compete for capital and deliver returns.
Challenges as GCEO
What worries me most is the gap between expectations and the condition of the assets. Some nights I go to bed unsure how the next day will unfold, but we keep going.
This role has shown me how much one person, with the right team, can influence a country, and how fragile systems can be if not managed carefully.
In the coming years, Nigerians should expect a steady, disciplined improvement, not miracles. Stabilising production, restoring investor confidence, reforming refineries and unlocking gas value will take time. Ambition shapes expectations, but only execution determines outcomes.
