NNPC’s Profit Drops By 64.7% To N136bn Amid N1.8trn Federation Account Remittance

The Nigerian National Petroleum Company Limited (NNPC Ltd) posted a sharp month-on-month decline in profit after tax in February 2026, falling 64.7% to N136 billion from N385 billion in January. The dip came despite a 4.24% rise in total revenue to N2.68 trillion. At the same time, statutory transfers surged, with NNPC remitting N1.804 trillion to the Federation Account—more than double January’s N726 billion—following recent policy directives on full oil and gas revenue remittance.

Key Numbers at a Glance

• Total revenue: N2.68 trillion in February (up from N2.57 trillion in January)
• Profit after tax: N136 billion in February (down from N385 billion in January)
• Federation Account remittance: N1.804 trillion (versus N726 billion in January)
• Crude oil and condensate output: 1.51 million barrels per day (mbpd) in February (down from 1.64 mbpd in January)

What Drove the Profit Squeeze

Lower production volumes and operational bottlenecks weighed on earnings in February. Average daily crude and condensate output slipped to 1.51 mbpd, pressured by multiple disruptions. These included:

• Trans Forcados Pipeline outage due to integrity issues
• Post-maintenance startup challenges at Stardeep’s Agbami GTC 2 and 3
• Delays in bringing the Sterling Oguali flow station fully online
• Sludge management constraints affecting production ramp-up at Enyie wells

While topline performance improved on the back of stronger revenue generation, the combination of reduced output and higher statutory transfers compressed bottom-line profitability.

Policy Shifts Reshaping Cash Flows

In mid-February 2026, a new Executive Order restructured revenue remittance practices across the oil and gas sector. The directive mandated full remittance of oil and gas proceeds to the Federation Account and suspended the collection of management and frontier exploration fees by NNPC Ltd. An inter-agency implementation committee chaired by the minister of finance and coordinating minister for the economy was established to ensure smooth execution. These measures aim to enhance transparency, align revenue flows with constitutional provisions, and strengthen public finances.

Operational Stabilisation and Infrastructure Progress

NNPC reported ongoing steps to stabilise operations and support a production recovery. The company cited improving asset reliability, quicker resolution of evacuation challenges, and closer collaboration with operators and stakeholders across key assets. It also highlighted progress on the AKK gas pipeline, with construction and installation works advancing to enable early gas delivery to Abuja.

These initiatives are expected to underpin steadier volumes, which, coupled with stronger infrastructure resilience, could support sustained revenue generation in the coming months.

Why It Matters

The February results capture a transition period for Nigeria’s oil and gas cash flows. Even as NNPC’s profit fell sharply, revenues held firm and remittances to the Federation Account climbed significantly, reflecting the immediate impact of the new remittance framework. For public finances, the surge in statutory transfers offers near-term relief. For NNPC, the path to stronger profitability likely hinges on resolving operational constraints, restoring production toward prior levels, and maintaining reliability across critical pipelines and facilities.

With infrastructure projects like the AKK pipeline moving forward and targeted efforts to boost asset uptime, the sector has the potential to stabilise. The balance between policy-driven remittances and operational performance will be central to how both NNPC’s earnings and government revenues evolve through the year.