NIGERIA SLASHES OIL BLOCK ENTRY COSTS TO $3M-$7M TO BOOST INVESTMENT
GREATRIBUNETVNEWS–THE Federal Government has reduced the signature bonus for oil blocks in the 2025 licensing round to between $3 million and $7 million, aiming to attract more investors and reduce entry barriers, according to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) .
KEY DEVELOPMENTS:
– Reduced Signature Bonus: $3 million for onshore and shallow-water blocks, $7 million for deepwater blocks, as announced by NUPRC
– Previous Rates: $10 million for deepwater, $7 million for shallow-water and onshore blocks in 2024; $200 million in previous years, according to NUPRC
– Payment Terms: Signature bonus must be paid in US dollars, with a dollar-denominated account, as stated by NUPRC
– Licence Details: Petroleum Prospecting Licence valid for 3-5 years, with possible extensions, according to NUPRC
– Bidding Process: Two-stage process, including qualification and bid stages, as outlined by NUPRC
– Block Availability: 50 blocks on offer, covering onshore, shallow-water, and deep offshore areas, according to NUPRC
“The blocks on offer are: PPL 2A29; PPL 2A30; PPL 2A31; PPL 2A32; PPL 2A33; PPL 2A34; PPL 2A35; PPL 2A36; PPL 2A37; PPL 2A38; PPL 2A39; PPL 2A40; PPL 2A41; PPL 2A42; PPL 2A43; PPL 2A44; PPL 2A45; PPL 2A46; PPL 2A47; PPL 2A48; PPL 2A49; PPL 2A50; PPL 2A51; PPL 2A52; PPL 2A53; PPL 2A54; PPL 2A55; PPL 2A56; PPL 2A57; PPL 2A58; PPL 2A59; PPL 2A60; PPL 2A61; PPL 2A62; PPL 2010; and PPL 307.”
Others are “PPL 308; PPL 309; PPL 900; PPL 901; PPL 902; PPL 903; PPL 700; PPL 701; PPL 702; PPL 703; PPL 800; PPL 801; PPL 802; and PPL 803.”
– Eligibility : Bidders can apply for up to two assets, with restrictions on consortium participation, as stated by NUPRC
Gbenga Komolafe, Chief Executive of NUPRC, explained that the reduction aims to stimulate competition, attract new capital, and reposition Nigeria as a more appealing destination in the global oil and gas market
It clarified that the licence is for “an initial duration of three years, with a possible extension of another three years for onshore and shallow waters, while it is five years for deep water and frontier.”
“The qualification stage involves the submission and evaluation of applications by interested parties or consortia in accordance with the Regulation and the Guidelines.
“Applicants shall provide all information required for this stage. Only applicants who are adjudged qualified and subsequently shortlisted by the commission shall proceed to the bid stage and will be required to execute a Confidentiality Agreement prior to participation.
“At the bid stage, shortlisted applicants or bidders shall submit their technical and commercial bids in accordance with the regulation, the guidelines, and any other bidding documents issued by the commission.”
The regulator warned that no bidder, whether participating individually or as a member of any consortium, shall submit applications for more than two assets in total across all applications.
“Participation in more than one consortium shall count towards this limit. For the avoidance of doubt, where a company has equity, direct or indirect ownership, or management involvement in multiple consortium vehicles, all such applications shall be aggregated and treated as a single bidder’s application,” it was stated.
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