Nigeria: royalties and charges on crude oil production and export

Last checked: 20 October 2026 · Levies by country

Nigeria charges royalty on crude oil under section 306 of the Petroleum Industry Act 2021 and the Petroleum Royalty Regulations 2022 ¹. Production-based rates run from 5% to 15% by terrain and output, with a flat 7.5% in frontier basins ¹. A price-based royalty rate runs from 0% to 10% ¹. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) assesses royalties, and royalty money is paid into the Federation Account ^1,2.

Main charge: Royalty on petroleum production under section 306 of the Petroleum Industry Act 2021 ¹
Legal basis: Petroleum Industry Act 2021, dated 16 August 2021 ², and Petroleum Royalty Regulations 2022, gazetted 22 November 2022 ¹
Production-based rates: 5% to 15% by terrain and output, 7.5% flat in frontier basins ¹
Price-based rate: 0% to 10% by fiscal oil price ¹
Assessed by: Nigerian Upstream Petroleum Regulatory Commission (NUPRC) ²
Paid into: Federation Account ^1,2
Filing deadline: Royalty statement due on or before the 15th of the month after production ¹
Contract levy: 1% of the value of every upstream contract to the Nigerian Content Development Fund, as stated by NCDMB ⁶

Royalty rates by terrain and output

Regulation 4 of the Petroleum Royalty Regulations 2022 applies royalty to petroleum production under section 306 of the Petroleum Industry Act 2021 ¹. Royalty is levied on all petroleum prospecting licences and petroleum mining leases ¹. Where several companies hold a licence or lease, each pays on its participating interest ¹.

Regulation 13 sets sliding scales by daily output ¹. Each higher rate applies only to the barrels above the threshold ¹. Mixed-terrain fields use a weighted average under regulation 14 ¹.

Terrain	Output band	Royalty rate
Deep offshore	Up to 50,000 bopd ¹	5% ¹
Deep offshore	Barrels above 50,000 bopd ¹	7.5% ¹
Onshore and shallow water	Up to 5,000 bopd ¹	5% ¹
Onshore and shallow water	5,000 to 10,000 bopd ¹	7.5% on the incremental volume ¹
Onshore	Barrels above 10,000 bopd ¹	15% ¹
Shallow water	Barrels above 10,000 bopd ¹	12.5% ¹
Frontier basin	All output, no sliding scale ¹	7.5% ¹

Royalty by price

Regulation 15 sets a royalty rate tied to the fiscal oil price ¹. The rate is 0% when the price is at or below the lower benchmark and 10% when it is at or above the upper benchmark ¹. Between the two, the rate is set by linear interpolation ¹.

The benchmarks started at US$50.00 and US$150.00 per barrel in 2021 and rise by 2% each January ¹. The Schedule to the regulations lists US$55.20 and US$165.61 for 2026 ¹.

Regulation 16 sets royalty on natural gas at 2.5% for gas used in Nigeria and 5% for gas exported ¹.

Who collects royalty and how it is paid

Section 7(w) of the Petroleum Industry Act 2021 gives NUPRC the function to compute, determine and assess royalties, rents, fees and other charges for upstream operations ². Section 24(4) requires NUPRC to see that money from royalties and rents under the Act is paid into the Federation Account ².

Under regulation 17, NUPRC receives royalty in kind or in cash on behalf of the Federation ¹. NUPRC must give 60 days' written notice before it takes royalty in kind ¹. NUPRC may ask NNPC Limited to lift and sell royalty oil for a fee in some contracts, with proceeds paid to the Federation Account ¹.

Royalty statements are due on or before the 15th of each month following the month of production ¹.
Regulations 43 and 44 apply penalties and interest on late payment under paragraph 12 of the Seventh Schedule of the Act ¹.

Export permits and cargo declaration

As reported by Mary Izuaka of Premium Times on 18 June 2025, NUPRC guidelines require exporters to obtain an export permit, vessel clearance and a Unique Identification Number through NUPRC online platforms before any shipment ⁵. The guidelines were issued under the Nigerian Upstream Petroleum Advance Cargo Declaration Regulation 2024 ⁵.

The same report said the Bill of Lading, Certificate of Origin and cargo manifest must carry the Unique Identification Number ⁵. Export documents must be uploaded within 24 hours of cargo loading, and violators may face administrative fines ⁵. The report named no fee for the permit ⁵.

Nigerian Content Development levy

In a statement published by Premium Times on 18 February 2026, the Nigerian Content Development and Monitoring Board (NCDMB) said covered entities must remit 1% of the value of every upstream contract to the Nigerian Content Development Fund ⁶. NCDMB cited section 104 of the Nigerian Oil and Gas Industry Content Development Act 2010 ⁶.

NCDMB said payments must go into accounts it designates, and payments made elsewhere are not recognised as valid ⁶. The levy is charged on contracts, not on barrels exported ⁶.

What NEITI reported for 2023

The NEITI oil and gas industry report for 2023 was published in September 2024 ³. It recorded fiscalised crude oil production of 537.571 million barrels in 2023, against 490.945 million barrels in 2022 ⁴. Crude liftings were 534.159 million barrels in 2023 ⁴.

The Independent Administrator's presentation of 26 September 2024 put total financial flows to government at US$30.85 billion for 2023 and US$35.8 billion for 2022 ⁴. The final report recorded total company payments of US$23.052 billion in 2023, of which US$22.652 billion was reconciled ³. The final report gives both figures, US$30.85 billion in its Table 6 and US$23.052 billion as total payments recorded ³. The summary pages of the report do not state an annual royalty total ^3,4.

The presentation listed outstanding royalty oil of US$5,017,779,729 and royalty gas of US$153,211,170 as of 31 August 2024 ⁴. NNPC Ltd crude sales were US$16,467,282,096 in 2023 ⁴.

Common questions

What is the royalty rate on Nigerian crude oil?

It depends on terrain and output. The Petroleum Royalty Regulations 2022 set 5% to 15% onshore and in shallow water, 5% to 7.5% in deep offshore and a flat 7.5% in frontier basins ¹. A separate price-based rate of 0% to 10% applies ¹.

Who collects oil royalties in Nigeria?

The Nigerian Upstream Petroleum Regulatory Commission assesses royalties under section 7(w) of the Petroleum Industry Act 2021 and must see that royalty money is paid into the Federation Account ².

Can Nigeria take royalty in barrels instead of cash?

Yes. Regulation 17 lets NUPRC take royalty in kind or in cash, with 60 days' written notice before taking it in kind ¹.

Does a crude cargo need a permit to leave Nigeria?

As reported by Premium Times on 18 June 2025, NUPRC requires an export permit, vessel clearance and a Unique Identification Number before shipment ⁵.

Is the 1% Nigerian Content levy a charge on exports?

No. NCDMB says it applies to 1% of the value of every upstream contract under section 104 of the Nigerian Oil and Gas Industry Content Development Act 2010 ⁶.

Rules and fees change. Check the official site linked above before you apply or pay. Spotted an error? Email [email protected] with the official link.

Sources

What is an oil export levy?
How oil export levies, permit fees and accreditation charges work, how they differ from royalties and profit oil, and where figures are published.
Ghana: royalties, state interest and the Petroleum Holding Fund
Ghana's crude oil royalty rates, GNPC carried interest, how receipts reach the Petroleum Holding Fund under Act 815 and the latest published figures.
Angola: petroleum production, income and transaction taxes
Angola's petroleum production tax, petroleum income tax and transaction tax, ANPG's role as National Concessionaire and the latest Angola EITI figures.
Chad: oil royalties, taxes and pipeline transit
Chad's crude oil royalty rates, corporate tax and tax oil, Chad-Cameroon pipeline transit charges and the latest Chad EITI figures for 2023.