Nigeria plans to eventually direct all of its crude oil production to domestic refineries as the country expands its local refining capacity, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said.
According to a report by S&P Global, Nigeria produced 1.74 million barrels of crude oil per day in June and is targeting production of 3 million barrels per day by 2030.
The report said Nigeria has traditionally exported most of its crude to refineries in Europe and Asia, but the country is now placing greater emphasis on domestic refining as part of efforts to improve energy security and increase national revenue.
The NMDPRA told the publication that Nigeria’s current domestic refining capacity stands at about 1.12 million barrels per day.
The authority is also working with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to enforce provisions of the law requiring crude producers to supply the domestic market.
NMDPRA Chief Executive Officer (CEO), Rabiu Umar, said the Dangote refinery is playing a major role in expanding Nigeria’s refining capacity, particularly with its planned increase in processing capacity to 1.4 million barrels per day.
Umar said the authority was working to address crude supply shortages affecting local refineries while ensuring compliance with the domestic crude supply obligations (DCSO) contained in the Petroleum Industry Act (PIA).
“The Federal Government wishes to end the pattern where much of the country’s crude [volumes] are exported and refined products imported,” Umar said.
“We are engaging the Nigerian Upstream Petroleum Regulatory Commission to ensure that every molecule of our 3 million b/d that we hope to achieve in the coming years is refined locally.”
Data released by the NUPRC on August 10 showed that Nigerian crude producers supplied 53.7 million barrels to domestic refineries during the second quarter of 2026.
The Dangote refinery received 52.6 million barrels of the volume.
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The upstream regulator said the refinery had been offered a higher volume of 68.1 million barrels, which would have been enough to meet its crude requirements fully.
The development comes amid continuing concerns over the availability and reliability of crude supplies for the Dangote refinery, which, according to the report, supplies as much as 90 percent of Nigeria’s refined petroleum products.
The refinery has previously turned to international crude supplies to maintain operations and support its expansion because of difficulties securing sufficient domestic crude.
“The state-run Nigerian National Petroleum Corporation (NNPC) was originally meant to supply the majority of its crude, but was restricted upon the launch of the refinery in 2024 by its forward selling,” S&P Global said.
The Petroleum Industry Act, which came into effect in 2021, provides the legal framework for domestic crude supply obligations.
“The PIA, which took effect in 2021, empowers the NUPRC to impose DCSOs on upstream operators and licensees and to mandate that a specified percentage of their produced crude and condensate be allocated for local sale.”
A spokesperson for the NUPRC also confirmed to Platts, the pricing and news brand of S&P Global Energy, that discussions were continuing with relevant government agencies over enforcement of the domestic crude supply provision.
“We have been holding meetings involving the NMDPRA, Ministry of Finance, and crude suppliers on the enforcement of this provision of the law,” the NUPRC spokesperson said.
The challenge is not new. In May, the NUPRC said upstream producers offered 68.7 million barrels of crude to domestic refiners in the first quarter of 2026 but ultimately delivered less than half of that volume.
The commission attributed the difference between the crude volumes offered and those actually delivered to disagreements over pricing between producers and domestic refiners.
The Federal Government’s plan would therefore represent a major shift in Nigeria’s traditional crude export model, with rising domestic refining capacity expected to reduce the need to export crude and subsequently import refined petroleum products.