By ABUJA, Nigeria — Nigeria’s state oil firm, NNPC, reported on Monday a 28% increase in its annual net profit, reaching 3.297 trillion naira ($2.14 billion), and declared a dividend.
Chief Financial Officer Umar Ajiya stated, “Despite inherent challenges of our operational and economic environment, we have improved the productivity and the financial performance of this great company.”
The NNPC announced a dividend of 2.1 trillion naira. The company also indicated plans to announce its initial public offering once shareholders and the board give their approval.
In a move to boost production, NNPC set a target of 2 million barrels per day crude oil production by the end of the year. This goal follows reported improvements in efforts to combat crude oil theft and pipeline vandalism.
Earlier this month, Nigeria’s Navy Chief Emmanuel Ikechukwu Ogalla reported that the country’s oil output had increased to between 1.6 million and 1.7 million barrels per day. This rise comes after the government strengthened security measures to curb crude theft.
NNPC’s profitability trend began in 2020 when it posted its first-ever profit. The company had reported losses in 2018 and 2019 following its transition to a commercial entity. The Nigerian government has stated that this transition was intended to deliver profits and improve accountability.
The state oil firm’s financial performance reflects broader changes in Nigeria’s oil sector, which is crucial to the country’s economy as Africa’s largest oil producer. The increase in profit and production targets come at a time when global oil markets are experiencing significant volatility.
NNPC’s ability to maintain and increase production levels will be critical for Nigeria’s economy, which relies heavily on oil exports for foreign exchange and government revenue. The company’s performance also has implications for global oil supply, particularly as other major producers adjust their output.
As NNPC moves forward with its commercial operations and potential public offering, industry observers will be watching closely to see how the company balances its role as a state entity with its commercial objectives.
