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ABSTRACT
This study examined constraints to crude oil production performance of the oil sector with Nigeria Production Development Company (NPDC) as case study.It is aimed at investigating whether corruption, insecurity, exchange rate volatility and crude oil price volatility significantly constrained the performance of NPDC. In pursuing these objectives, quarterly data on corruption, insecurity, exchange rate volatility, crude oil price volatility, and crude oil and gas production performance of NPDC were sourced from Central Bank Statistical Bulletins, NPDC Annual Reports, Work Bank and Transparency International. The data covered the period from first quarter of 2008 to first quarter of 2016. The data were first of all subjected to unit root test. Since they were all found to be integrated (stationary) at first order, ordinary least square was then used to test the relationship between the variables at 5% level of significance. The study revealed that insecurity and corruption significantly constrained the performance of NPDC, but exchange rate volatility and crude oil price volatility were found not to have significantly constrained the production performance of NPDC. Based on findings, we recommend that NPDC through the federal government of Nigeria shouldaddress the insecurity issues in the Niger Delta region vide the provision of basic infrastructures and social amenities, education and empower the National Environmental Standards and Regulations Enforcement Agency (NESREA) to regulate the activities of companies in the oil and gas sector.In additions, effort should be intensified to fight corruption through effective legislation and stiff penalties to promote good governance, transparency, and accountability in NPDC.
