NUPRC oil block awards
The Nigerian Upstream Petroleum Regulatory Commission has named 31 companies as preferred bidders for 37 oil and gas blocks offered under Nigeria’s 2025 Licensing Round, warning that any company that fails to meet the required post-award conditions within 90 days will lose its opportunity to acquire the asset.
The announcement followed the commercial bid conference held in Abuja on Tuesday, bringing the competitive stage of an eight-month licensing exercise to a close.
Although the development has been widely described as an award of oil blocks, the successful companies have not yet received final Petroleum Prospecting Licences. They must first pay the applicable signature bonuses, satisfy all statutory conditions and secure the approval of the Minister of Petroleum Resources in accordance with the Petroleum Industry Act 2021.
The latest NUPRC oil block awards involved 37 of the 50 oil and gas assets initially offered by the Federal Government. The remaining 13 blocks did not attract bids and have been returned to the licensing basket for possible inclusion in a future exercise.
According to the commission, 143 companies submitted about 200 bids for the 37 contested assets after passing through the prequalification and technical-evaluation stages.
Winners face strict 90-day deadline
Speaking after the bid conference, the Commission Chief Executive of the NUPRC, Oritsemeyiwa Eyesan, directed the preferred bidders to begin the post-award process without delay.
She said final licences would be presented only after the companies paid the appropriate signature bonuses and received ministerial approval.
The regulator warned that failure to complete the conditions within 90 days would invalidate the provisional selection, allowing it to invite reserve bidders to take over the affected blocks.
This condition gives the NUPRC oil block awards a level of urgency that was missing from several previous licensing exercises in Nigeria.
For decades, the country struggled with situations in which companies obtained oil blocks but failed to raise financing, conduct exploration or move the assets into production. Some licence holders travelled from one international conference to another searching for technical and financial partners while the resources remained underground.
The new deadline is intended to prevent successful bidders from treating petroleum licences as speculative assets that can be held indefinitely without development.
Preferred bidders, not final licence holders
The distinction between preferred bidders and final licence holders is important.
The 31 companies have emerged as winners of the competitive bidding stage, but their selection remains conditional.
Under the licensing guidelines, winners are expected to receive Petroleum Prospecting Licences, which grant exclusive rights to drill exploration and appraisal wells within the designated acreage.
For onshore and shallow-water assets, the initial licence duration is three years, with the possibility of a further three-year extension. Deepwater and frontier licences have an initial duration of five years.
The NUPRC oil block awards will therefore become legally effective only after the preferred bidders complete the prescribed financial, regulatory and contractual requirements.
Public reporting must not create the impression that the companies can immediately begin producing crude oil from the blocks.
They must still undertake geological studies, seismic interpretation, exploration drilling and appraisal before establishing whether discoveries can be commercially developed.
Thirty-one companies emerge successful
The successful companies named by the commission include SSonic Petroleum Limited, CFP Pipeline and Flowlines, Dutchford E&P Limited, Attabanson Global Company Limited, Rosem Energy Limited, Pivot-GIS Limited, Network Exploration and Production, Asharami Energy and LexOil.
Others include BVOF, Gupsco Energy Limited, Saratoga, Volante, Concept-Reel Petroleum Services Limited, Clinton Oil Field, Nuway Oaklane Limited, Ramec Italia, Blueridge Exploration and Production, Up Energies Limited, AYM Shafa and Blackrock Holdings Limited.
Also listed were Funtay Integrated Business Limited, Riparian Development and Production Limited, Nikstallis, Stardeep Petroleum, Dakoda & U Limited, Southborne Oil and Gas Limited, Lanaka Petroleum, Highban Resources Limited and Eyre Energy Limited.
The fact that 31 companies secured 37 assets means that some bidders emerged preferred bidders for more than one block.
The licensing guidelines, however, limited each company or consortium to applications for no more than two assets.
The NUPRC oil block awards covered assets in onshore, shallow-water, deep-offshore and frontier locations.
NUPRC says evaluators faced threats
Eyesan disclosed that members of the evaluation team faced intimidation, pressure and threats during the licensing process.
According to her, the threats continued until the eve of the commercial bid opening, but the evaluators refused to compromise the exercise.
She said President Bola Tinubu had directed the commission to conduct a credible and transparent process.
Representatives of the Nigeria Extractive Industries Transparency Initiative also observed the exercise, according to the regulator.
The disclosure raises serious questions that should not be ignored after the bid conference.
If officials were subjected to serious threats, the commission should provide the appropriate security and anti-corruption authorities with evidence capable of identifying those responsible.
The integrity of the NUPRC oil block awards cannot be protected merely by publicly stating that threats occurred.
Attempts to intimidate officials involved in allocating national petroleum assets may amount to efforts to manipulate a high-value public process. Such conduct should be investigated rather than treated as an unfortunate feature of doing business.
The commission should also assure Nigerians that the pressure did not influence the technical evaluation or selection of successful bidders.
Automated system used to calculate scores
The NUPRC said the commercial evaluation process was designed to reduce human interference.
According to the commission, technical evaluations had been completed before commercial bids were opened publicly. Officials involved in the technical assessment reportedly had no prior access to the commercial offers.
The commercial component accounted for 40 per cent of the weighted score, with the results calculated through an automated system.
The licensing-round criteria also considered technical competence, proposed work programmes, financial strength, corporate governance, unit production costs, bank guarantees and decarbonisation plans.
Signature bonuses had to fall within an approved range of $3 million to $7 million, except where matching bids required a sealed re-bid under the tie-breaking procedure.
This system suggests that the NUPRC oil block awards were not decided solely by the companies that offered the highest signature bonuses.
That is a welcome departure from a system in which financial promises could overshadow the capacity to explore and develop an asset.
A company may offer a large upfront payment and still lack the equipment, expertise, personnel or financing required to drill a single well.
PIA ends discretionary allocation
The Minister of State for Petroleum Resources responsible for oil, Heineken Lokpobiri, said the Petroleum Industry Act had ended the discretionary allocation of oil blocks.
He argued that the law had established a competitive process under which neither government officials nor evaluators could secretly determine the contents of commercial bids before they were publicly opened.
https://ogelenews.ng/nuprc-names-winners-of-37-oil-blocks-gives-firms-90…
Lokpobiri also warned the preferred bidders not to obtain licences merely to search for partners abroad.
He said the assets must be converted into field development and production rather than carried around as documents at international conferences.
The warning is central to the credibility of the NUPRC oil block awards.
Nigeria does not need another generation of dormant licence holders. It needs companies capable of investing in seismic surveys, exploration wells, field-development plans, production facilities and environmental safeguards.
Thirteen blocks attract no bids
Of the 50 blocks offered under the licensing round, 13 failed to attract bids.
Those assets have been returned to the Federal Government’s licensing basket.
The lack of interest should prompt a careful assessment by the NUPRC.
Some blocks may have been considered commercially unattractive because of limited geological data, difficult operating environments, security concerns, environmental exposure or the absence of nearby infrastructure.
The regulator should not simply return the assets to the market under identical conditions and expect a different outcome.
Before placing them in another licensing round, it should determine why investors stayed away and whether improved data or revised commercial terms would make the assets more attractive.
However, any adjustment must protect the long-term interests of the Nigerian people.
The government should not reduce entry requirements so drastically that technically weak companies acquire valuable petroleum acreage they cannot develop.
Government targets investment and production growth
The official objectives of the 2025 Licensing Round include growing Nigeria’s oil and gas reserves, attracting foreign investment, increasing production, expanding gas utilisation, creating employment and developing Nigerian content.
The exercise was also intended to generate value for both the government and investors.
Nigeria has experienced years of declining investment in petroleum exploration, ageing infrastructure, oil theft and production disruptions.
Although the country possesses substantial oil and gas resources, production has frequently fallen below government targets.
The NUPRC oil block awards are expected to help reverse that trend, but licences alone will not produce additional barrels.
Exploration is expensive and uncertain. Some blocks may produce commercial discoveries, while others may not.
Even when petroleum is discovered, years may pass before field-development plans are approved, production facilities are installed and commercial output begins.
The government should therefore avoid calculating immediate production or revenue increases solely from the number of blocks offered.
Local content must go beyond ownership
The licensing exercise also provides opportunities for Nigerian companies, professionals and service providers.
However, local content should not be measured only by the names of Nigerian shareholders in successful bidding companies.
It should be reflected in the employment of Nigerian engineers and geoscientists, the procurement of domestic goods and services, technology transfer and the development of local fabrication capacity.
The NUPRC oil block awards should come with clear and enforceable Nigerian-content obligations.
Each preferred bidder should publish a development plan showing how Nigerian workers and businesses will participate in exploration and eventual production activities.
At the same time, indigenous ownership must not be used as an excuse to lower financial or technical standards.
A Nigerian company that lacks the capacity to develop an asset should not receive protection from regulatory scrutiny merely because it is locally owned.
Host communities must not be ignored
Several of the blocks are located in areas where communities have endured decades of environmental degradation, oil spills, gas flaring and conflict over the distribution of petroleum wealth.
Successful bidders must begin community engagement before commencing major operations.
The NUPRC oil block awards must not lead to another cycle in which companies enter communities only after licences have been granted and security problems have emerged.
Operators should disclose their environmental-management plans, spill-response arrangements and proposed mechanisms for engaging host communities.
They must also comply with the host-community provisions of the Petroleum Industry Act.
The development of new assets should create employment and social benefits without repeating the environmental mistakes associated with older oil operations.
Transparency must continue after the bid conference
A public commercial bid conference is an important transparency measure, but accountability should not end with the announcement of preferred bidders.
The NUPRC should publish the blocks won by each company, the applicable signature bonuses, the beneficial owners of the successful entities and the major work commitments attached to each licence.
It should also disclose which preferred bidders complete the post-award conditions within the 90-day period and which assets are transferred to reserve bidders.
Without continuing disclosure, the public may never know whether the NUPRC oil block awards progressed from provisional selection to valid licences.
Quarterly reports should identify the companies that have paid, received ministerial approval and commenced their work programmes.
This would allow Nigerians to distinguish active investors from companies that obtained blocks but failed to move beyond paperwork.
Ninety-day warning must be enforced
The commission’s warning will have little value unless it is enforced impartially.
If a preferred bidder fails to meet the conditions within 90 days, the regulator should follow its stated procedure and invite the qualified reserve bidder.
It should not extend deadlines indefinitely because of political connections or private appeals.
Past regulatory failures have often begun with small exceptions granted to influential companies.
The success of the NUPRC oil block awards will depend on whether the same rules apply to every bidder.
Companies that cannot pay their signature bonuses or satisfy their statutory obligations within the prescribed period may also lack the financial capacity required for expensive exploration and field development.
Allowing such bidders to retain the assets would undermine the entire evaluation process.
Nigeria needs drilled wells, not paper licences
The announcement of preferred bidders marks the end of the commercial competition, but it is only the beginning of the more difficult work.
The 31 companies must convert their selections into valid licences, mobilise capital, undertake exploration and move commercially viable discoveries towards production.
The regulator, in turn, must monitor their work programmes and apply the Petroleum Industry Act without fear or favour.
The NUPRC oil block awards should ultimately be judged by the number of wells drilled, reserves discovered, gas resources developed, jobs created and producing fields brought on stream.
A successful bid conference is not the same as a successful petroleum-development programme.
Nigeria has issued oil licences before. What it has not always achieved is disciplined and timely development of the assets.
The 90-day deadline is therefore an important first test.
If the commission enforces it strictly, publishes the final licences and prevents speculative holding, the exercise could strengthen confidence in Nigeria’s upstream sector.
If it allows preferred bidders to delay indefinitely, the country may once again end up with valuable petroleum assets trapped in the hands of companies that are unable or unwilling to develop them.
