KEY POINTS

• Nigeria’s active rig count fell 45 percent to 22 in February 2026, down from 40 in January, as exploration contracts slowed
• Standby rigs jumped from 11 to 25 over the same period, while the total rig count held at 72
• NUPRC’s “drill or drop” rule is attracting committed investors to the 2025 licensing round, which puts 50 oil blocks on the market

Nigeria’s oil exploration contracted sharply in February 2026, with the active rig count falling 45 percent to 22 from 40 in January as upstream activity slowed across the country.

Data from the Nigerian Upstream Petroleum Regulatory Commission showed standby rigs jumped to 25 from 11 over the same period, even as the total rig count held steady at 72.

Industry sources attributed the decline to a slowdown in contract signings. Bala Zakka, a Port Harcourt-based energy analyst, said many contracts remained in active negotiation and expected upstream drilling to rebound in the second quarter once operators finalize terms.

Calls for more upstream capital

Colman Obasi, national president of the Oil and Gas Services Providers Association of Nigeria, called for deeper investment across the upstream value chain.

“We need to invest more resources upstream to deploy more rigs, make additional oil and gas discoveries and grow Nigeria’s reserves,” Obasi said.

Meanwhile, NUPRC is leaning on the Petroleum Industry Act to accelerate the pace. The commission’s chief executive, Oritsemeyiwa Eyesan, noted, however, that the era of companies holding prospecting licenses without development is over.

Drill or drop drives investor appetite

Section 94 of the PIA compels operators to either begin work on allocated assets or relinquish them, a provision the industry calls “drill or drop.” Eyesan said enforcement has drawn more committed investors to the ongoing 2025 licensing round, which puts 50 oil blocks on the table.

“In the past, some operators held licenses for up to 20 years without development. That era is over,” Eyesan also said. “We now have more assets available, giving us the impetus to pursue annual bid rounds.”

She also confirmed that pre-qualification results for the 2025 round reflect genuine appetite from both small and large operators.

In fact, analysts expect Nigeria’s oil exploration activity to pick up through the second quarter once stalled contracts reach the signing stage, making the February dip a pause rather than a trend.