The Nigerian government has awarded 25 oil block licenses to major oil companies such as TotalEnergies Exploration, MRS Oil and Gas Limited, Sahara Deepwater Resources Limited and 20 other companies for the newly available oil blocks in the country.
This was unveiled by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) at the 2022/23 mini bid and Nigeria 2024 Licensing Round Commercial Bid Conference held in Lagos in December, according to a report by African Council.
According to the Commission Chief Executive, Gbenga Komolafe, 31 oil blocks were offered for bidding while 25 were bid, just as the remaining six were returned to the basket.
He further explained that the bidding process was in line with Section 7(t) of the Petroleum Industry Act (PIA), which empowers the NUPRC to conduct periodic bidding rounds for the award of Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs).
At the end of the bidding exercise, 25 winners emerged as bidders while 10 emerged as reserved bidders.
Komolafe said during his presentation:
“This is the best in the history of the nation that we could conduct a licensing round in a very transparent manner. We have set the standards that we will continue to improve upon.
“Declining production levels and increased global competition demand strategic action. Fortunately, the Petroleum Industry Act has given us a unique opportunity to transform the industry, attract investment, and position Nigeria as a leader,” he said.
He stated that Nigeria’s commitment to the UN Sustainable Production Goals will include an emphasis on natural gas production, fallow fields, and underexplored assets in the 2025 licensing round.
Komolafe said the NUPRC aims to make the licensing rounds an annual event to address challenges such as declining production and rising global competition.
2025 Bidding Round
According to the NUPRC boss, the blocks for the 2025 bid round will be harvested from an idle assets recovery program known as ‘drill or drop,’ which the commission has commenced in line with the provision of the Petroleum Industry Act (PIA).
Following the completion of the bidding process, the next steps, he said, include block allocation and award, payment of signature bonuses, exploration and production, and environmental stewardship.
In an earlier report, NUPRC said the 2025 bid will focus mainly on underdeveloped regions to help ramp up production.
Nigeria has faced challenges in meeting its OPEC production quota of 1.5 million barrels per day (bpd) due to factors such as underinvestment, oil theft, and pipeline vandalism.
To address these issues and boost production, the oil regulator has introduced oil block licensing as a strategic initiative to attract investment and enhance output.
