Pipeline losses drop, oil production in four-month rally

Nigeria is currently witnessing oil production surge due to several factors. Firstly, oil losses through pipeline remain at historical lows based on Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in July report. Also, Nigeria’s combined crude oil and condensate production also increased to approximately 1.735 mb/d in June due to increased security of oil assets. The production milestone represents a fourth consecutive monthly increase and fallout of ensuing peace and stability in Niger Delta and impact of Tantita Security Services Nigeria Ltd (TSSNL) operations in the protection of national assets, especially oil pipelines in the region.

For years, Nigeria grappled with losses running into billions of dollars due to sabotage on oil installations and pipelines, community interference, as well as production shutdown.

These losses had negatively impacted national revenue and kept oil production at its lowest ebb.

However, the sector is turning the corner with report from NUPRC showing that pipeline losses have continued to drop, helping oil production to surge to new levels.

These achievements have been linked to the superlative works done by the Tantita Security Services Nigeria Ltd (TSSNL) in the Niger Delta region.

For many stakeholders, the continued oil production surge, peace and stability in the Niger Delta are expected to boost government revenue, external reserves and the broader fiscal outlook.

The Federal Government of Nigeria’s appointment of Tantita Security Services Nigeria Ltd (TSSNL) to protect oil assets and ensure peace and stability in the Niger Delta comes into play.

President Bola Ahmed Tinubu had appointed Tantita Security Services Nigeria Limited (TSSNL), led by High Chief, Dr. Government Oweizide Ekpemupolo, alias Tompolo, to protect Nigeria’s oil assets in the Niger Delta region. The apointment was to enable TSSNL, through its security operations, to support the national economy in getting the full benefits of oil resources.

The TSSNL works in collaboration with other security outfits to achive its goals of securing oil assets and ensuring peace and stability in the Niger Delta region.

Tantita’s operations had ensured the security of oil pipelines, ensuring the uninterrupted flow of petroleum resources, and ensuring that Nigeria migrated from a position of constant loss management to stability, planning, growth and development.

The TSSNL operations have transformed the oil and gas landscape and allowed Nigeria to expand oil production quota and significantly cut rampant oil theft.

Its track record in mitigating risks associated with oil pipelines has positioned it as a reliable partner in preserving Nigeria’s economic backbone.

As stakeholders advocate for continued collaboration with TSSNL, the imperative of securing oil infrastructure remains at the forefront of efforts to ensure the nation’s sustainable development.

In the development process of any society, certain assets contribute to the advancement of society and its people. These assets ensure economic or monetary benefits for the people. These assets could be regarded as operating assets, non-operating assets or leased assets, among others.

The impact of TSSNL’s operations was captured in a recent survey, with majority of the respondents attributing the de-escalation of security incidents in the Niger-Delta region to the pipeline surveillance operations executed by TSSNL.

OPEC Quota Met for Third Straight Month 

Nigeria met its OPEC production quota for the third straight month in July, producing a combined 1.67 million barrels per day (mbpd) of crude oil and condensate, the NUPRC said.

NUPRC data showed crude oil output averaged 1.505mbpd in July, while condensate added 0.17mbpd, taking the combined daily average to 1.67mbpd. The regulator said peak daily production reached 1.78mbpd and the lowest daily output was 1.57mbpd during the month.

“Despite some operational problems at a few fields, Nigeria met the OPEC quota of 1.5mbpd in July,” a NUPRC spokesperson said. The commission noted, however, that overall production fell 4% compared with June.

The NUPRC attributed the month-on-month decline mainly to operational challenges at the Erha and Akpo fields. “Disruptions at Erha and Akpo constrained volumes and were a significant factor in the production shortfall for the month,” the spokesperson said.

The regulator added that most other producing assets remained stable. “Operators implemented measures to maintain production efficiency and to minimise the impact of the disruptions,” the NUPRC said.

Domestic crude supply surges

The NUPRC Q2 2026 statistics on the enforcement of the Domestic Crude Supply Obligation (DCSO) in accordance with the provisions of Section 109 of the Petroleum Industry Act showed that a total of 53.7 million barrels of crude oil and condensate were supplied to local refiners between April and June, showing an overall performance of 97.4 per cent.

The statistics showed that DCSO is being actively administered and enforced by the NUPRC.

On a monthly basis, the Commission meets with stakeholders, including crude oil producers and local licensed refineries after which the producers are allocated a specific volume of their crude oil and condensate which should be offered to local licensed refineries.

READ ALSO: Nigeria nears OPEC oil production target as PINL intesifies pipeline surveillance

However, in line with the PIA, the framework operates on a “willing buyer, willing seller” basis, which shapes eventual outcomes.

In the month of April, following consultations with stakeholders, 18,127,638 barrels were allocated to producers.

However, the producers exceeded expectation, offering 19,312,476 barrels to refiners.

Eventually, 20,879,381 barrels were supplied to local refiners, meaning the producers met 114.9 per cent of their allocation.

In May, the Commission, in enforcing its DCSO, allocated 18,778,392 barrels of crude oil to the producers but the producers exceeding their expectation once again, offered 23,187,893 barrels to the local refiners.

However, the producers’ actual supply to the refiners by the end of the month stood at 14,228,865 barrels representing 75.8 percent compliance.

In the month of June, the Commission allocated 18,172,638 barrels to the producers. The producers offered 26, 835, 119 barrels to refiners which in turn took 18, 606, 026 barrels representing a 102.4 percent performance.

The Commission in a statement observed that the improvement in DCSO coincided with an increase in local oil production and the signing of the long-term crude supply agreement supported by bankable Sales and Purchase agreement between the Producers and Domestic refiners.

At the level of refinery participation, the statistics show that the Dangote Refinery required 63 million barrels in Q2 but the producers offered higher volumes of 68.1 million barrels.

The 68.1 million barrels offered to the Dangote Refinery by producers represent 98% of all offered volumes.

Eventually, 52.6 million barrels were accepted by the Dangote refinery. This implies that the refinery only accepted 78 percent of what it was offered.

The Commission reaffirms its commitment to achieving the government’s objective of energy sufficiency.

Leveraging the framework of the PIA, 2021, the Commission said it aims to sustain recent gains in crude oil production while continuously enforcing the DCSO.

Views from stakeholders

President General, Niger Delta Progressive Alliance, Nse Victor Udoh, said pipeline protection enabled national institutions to progress from reactive crisis management to strategic foresight, from temporary containment to durable systems-building, and from uncertainty-driven decisions to calculated national ambition.

“It is important to clarify the role of pipeline surveillance within the wider energy landscape. Energy security encompasses the full value chain, from exploration and production to refining, distribution, pricing policy, and subsidy frameworks. Pipeline surveillance does not manage these domains,” he said.

He added: “Its mandate is precise: safeguarding critical infrastructure that transports petroleum resources. Yet this single function has proven foundational. Without secure transportation channels, production targets falter, refining plans collapse, exports decline, and fiscal projections become unreliable.”

Continuing, he wrote: “Asset protection, in this context, is not a supporting activity. It is a precondition for economic order. In effect, the pipeline is the hinge on which the entire petroleum value chain turns. When that hinge is weak, every other link in the chain carries strain. When it is secure, the entire system gains coherence.”

The immediate impact has been operational. Sustained monitoring and rapid response systems have sharply reduced pipeline breaches and illegal tapping. Receipt rates have climbed toward full recovery, with national output rising to levels not seen in recent memory.

This redirection has restored Nigeria’s credibility in international oil markets, allowing Nigeria to reclaim market share lost to Angola and Libya.

“Economic stability follows predictability. When crude flows are secure, refineries can plan feedstock intake with assurance. Export commitments can be met without fear of sudden shortfalls. Gas-to-power projects can operate without recurrent shutdown risks.”

Investors can assess Nigeria’s petroleum sector with clearer risk profiles. Surveillance therefore does more than stop theft. It reintroduces reliability into national energy planning. And reliability is the bedrock upon which sustainable economic growth is built. With predictable flows, national budgeting becomes more credible, infrastructure planning becomes more precise, and long-term contracts become easier to negotiate. Predictability is the silent currency of modern economies, and pipeline surveillance has begun restoring it,” he stated.

Further benefits extend into public finance. Higher accounted-for production translates directly into increased export revenues, improved foreign exchange inflows, and strengthened fiscal capacity. National oil company performance in recent years illustrates this shift toward profitability and efficiency, driven in part by reduced losses and enhanced operational continuity.

As revenues stabilise, government budgeting gains credibility.

Development planning becomes less speculative. The national economy gains breathing space to invest in infrastructure, social services, and diversification. This breathing space matters. It allows policymakers to think beyond survival and begin shaping structural reforms, industrial expansion, and long-term social investment. It also reduces dependence on emergency borrowing and short-term fiscal patchwork.

Traditional rulers and community leaders in the Niger Delta have called for continued support for Tantita Security Services Limited following a vote of confidence passed on the firm by the National Assembly of Nigeria.

The leaders said the company’s involvement in securing oil and gas pipelines has led to visible improvements in oil-producing communities, particularly in reducing crime and creating jobs for youths.

Speaking on the development, the President-General of the Isoko Development Union, Christopher Akpotu, praised the joint committee of the Senate and House of Representatives for dismissing petitions filed against the firm.

He described the decision as a positive step for the Niger Delta and urged stakeholders to focus on economic gains rather than internal disagreements. “That is the right way to go,” he said. “There are many opportunities in the oil and gas sector. We should focus on how to derive more benefits rather than fighting over what has already been allocated.”

Akpotu warned that continued disputes among communities could allow outsiders to take over opportunities meant for host communities. “At the end of the day, if we continue fighting, we give room to those who have no stake in our communities to take what rightfully belongs to us,” he added.

Similarly, the President-General of the Ughelli Descendants Union, Sam Akpemegi, said the company has improved security since it began operations, noting that both visible and intelligence-based strategies have been deployed. “They have done very well and improved security since they began operations,” he said, adding that the firm’s activities now cover a large number of communities.