Nigeria’s continued failure to meet its crude oil production quota set by the Organization of the Petroleum Exporting Countries (OPEC) has intensified scrutiny of the ₦48 billion annual pipeline surveillance contract awarded to Tantita Security Services, amid growing calls for a review of past terms of contracts awarded by the Nigerian National Petroleum Company Limited (NNPC Ltd).
High Chief Government Ekpemupolo (Tompolo),
Despite the security arrangement intended to curb crude oil theft and protect critical pipeline infrastructure Nigeria has missed its OPEC production quota for six consecutive months, raising questions about the effectiveness of the contract and the broader efficiency of public spending in the oil sector.
According to OPEC’s January 2026 Monthly Oil Market Report, Nigeria produced about 1.459 million barrels per day (mbpd) in January, below its 1.5 mbpd allocation. While output improved marginally from December’s 1.422 mbpd, the country has remained under quota since August 2025, despite sustained security expenditure.
Security Spending Without Measurable Gains
Under the current arrangement, NNPC Ltd reportedly pays approximately ₦4 billion monthly to Tantita Security Services for pipeline surveillance across the Niger Delta—amounting to ₦48 billion annually. The expectation was that tighter security would translate into reduced losses, higher production volumes, and stronger export earnings.
However, production data from the Nigerian Upstream Petroleum Regulatory Commission shows that Nigeria’s crude output declined between November and December 2025, even as surveillance spending continued. Year-on-year production also fell by more than 80,000 barrels per day, highlighting persistent structural and security challenges.
Industry sources continue to report cases of pipeline vandalism, illegal bunkering, and shut-in volumes suggesting that the expensive surveillance framework has not delivered the decisive impact required.
Pressure Mounts on NNPC Leadership
The development has placed renewed pressure on NNPC Ltd’s leadership, with industry stakeholders calling on the company’s Group Chief Executive Officer, Engineer Bashir Bayo Ojulari, to urgently review what many now describe as a clear case of public fund wastage.
Analysts argue that pipeline surveillance is one of the most critical areas requiring reform within NNPC Ltd, warning that failure to rein in inefficiencies could undermine ongoing efforts to restore credibility, transparency, and operational discipline at the national oil company.
There is growing concern that the inability of NNPC’s leadership to decisively address this excess could have serious implications for its image and tenure. Any wastage of public funds linked directly to NNPC Ltd, observers note, inevitably dents the credibility of its chief executive and weakens confidence in the reform agenda promised by the company.
Revenue Losses and National Impact
Nigeria’s repeated failure to meet its OPEC quota has significant fiscal implications. Crude oil remains the country’s primary source of foreign exchange and government revenue, and every barrel lost represents forgone income at a time of mounting economic pressure.
With relatively stable global oil prices, analysts say Nigeria’s underperformance is no longer defensible, particularly in the face of heavy security spending that has not translated into higher output.
Case for Contract Review
Critics argue that maintaining a ₦48 billion annual surveillance contract without clear, verifiable results sets a dangerous precedent and risks institutionalizing inefficiency. They contend that if the current arrangement cannot demonstrably reduce losses and boost production, then a comprehensive review—or outright withdrawal—of the contract is justified.
As Nigeria prepares for increased domestic crude demand driven by the Dangote Refinery, the cost of persistent production leakages becomes even more damaging.
For many industry watchers, the conclusion is clear: reforming pipeline security spending is no longer optional. If unchecked, the continued wastage of public funds through ineffective contracts could not only derail Nigeria’s production targets but also become a defining test of NNPC Ltd’s leadership credibility.
First reported by ENigeria News
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