The Group Chief Executive Officer of Nigerian National Petroleum Company Limited, Bayo Ojulari, has disclosed that the company no longer receives monthly federation allocations and must now raise finance independently, marking a fundamental shift in the structure and operating philosophy of Nigeria’s national oil company.
Ojulari made the disclosure on Sunday while briefing Bola Tinubu in Lagos, amid intense price competition in Nigeria’s downstream petroleum market that has seen petrol prices fall sharply across the country.
“NNPCL no longer receives federation allocations and must raise finance independently like any other business,” Ojulari said, stressing that the change is a direct consequence of the Petroleum Industry Act (PIA), which restructured Nigeria’s oil and gas sector.
Commercialisation Under the PIA
Ojulari explained that the PIA fundamentally separated regulation from commercial activity, ending the era in which the former Nigerian National Petroleum Corporation combined regulatory powers with business operations.
“Before the PIA, everything was under NNPC, including regulation. The PIA divided the roles clearly. Regulation is now handled by the regulators, while NNPCL is a commercial company that must compete profitably,” he said.
Under the new framework, downstream and midstream regulation fall under the Nigerian Midstream and Downstream Petroleum Regulatory Authority, while upstream oversight rests with the Nigerian Upstream Petroleum Regulatory Commission.
Ojulari emphasised that NNPCL no longer sets fuel prices and has no regulatory authority in the deregulated market.
Fuel Price War and Consumer Impact
The NNPCL chief described the ongoing price war in the downstream sector as a natural outcome of Nigeria’s transition from heavy import dependence to domestic refining and open competition.
Petrol prices have fallen from over ₦1,200 per litre in November 2024 to as low as ₦739 per litre at some outlets in December 2025, driven largely by competition between Dangote Refinery, NNPCL retail stations, and independent marketers.
“Where there is healthy competition, the buyers are the ultimate beneficiaries,” Ojulari said. “There will be some tension because we are going through a major transition, but Nigerians on the street will ultimately benefit.”
According to the National Bureau of Statistics, the average retail price of Premium Motor Spirit fell by over ₦150 per litre year-on-year, reflecting improved supply and intensified competition.
Market Pressure on Marketers
The aggressive price cuts have created challenges for marketers who purchased petrol at higher prices and are now forced to sell at losses or risk losing customers. Industry groups say price competition has become the primary determinant of customer loyalty, with marketers facing mounting bank interest costs amid shrinking margins.
Ojulari said NNPCL is operating as a “supplier of last resort,” working with all downstream players, including Dangote Refinery—where NNPCL holds an equity interest—to ensure nationwide product availability.
Production Growth and Infrastructure Push
Briefing the President, Ojulari disclosed that crude oil production has risen from about 1.5 million barrels per day last year to over 1.7 million barrels per day in 2025, while gas output has increased to more than 7 billion standard cubic feet per day.
NNPCL targets at least 1.8 million barrels per day in 2026, as part of efforts to meet the administration’s 2 million barrels-per-day target by 2027 and attract over $30 billion in investment by 2030.
He also confirmed the completion of welding on the main line of the Ajaokuta–Kaduna–Kano gas pipeline, including the River Niger crossing, with commissioning expected in early 2026. The project is expected to boost power generation, fertiliser production, and industrial activity in northern Nigeria.
A Defining Shift for Nigeria’s Oil Sector
Ojulari’s remarks underscore a decisive structural break with the past: NNPCL is no longer a treasury-funded state utility but a commercially exposed energy company subject to market discipline. While the transition has triggered price volatility and short-term disruptions, the NNPCL boss insists that competition, domestic refining, and independent financing will ultimately deliver a more stable and consumer-friendly petroleum market.
