With the 2024 Oil Licensing Round in its concluding phase, with the announcement of the preferred and reserve bidders, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) on Wednesday unfolded plans to organise another bid round in the new year to further grow the industry.
The Commission Chief Executive (CCE), Engr. Gbenga Komolafe said at the 2024 Licensing Round Commercial Bid Conference in Lagos that the fresh bid exercise would focus on the recovery and development of unexplored oil assets in the country.
With the successes recorded in recent bid licensing rounds, Komolafe said the Commission has resolved to make the exercise an annual event to boost the country’s oil and gas production capacity.
“While we are proud of our recent achievements as industry stakeholders, we must remain mindful of the challenges ahead as a result of declining production levels and increased global competition, which demand strategic action,” he said.
The CCE the enactment of the Petroleum Industry Act (PIA) 2021 has offered the country a unique opportunity and incentives to transform the oil and gas industry, attract investment, and position Nigeria as a leader in the global oil and gas arena.
To enable the country take advantage of the opportunities, he said the Commission has decided to launch another licensing round in 2025, to build on the lessons learnt from the 2024 round.
The fresh bid round, he announced, would focus on discovering undeveloped oil fields and fallow oil assets, with priority attention on the development of natural gas resources to support Nigeria’s commitment to the UN Sustainable Development Goals (SDGs).
He said the Commission was committed to restore investors’ confidence in the oil and gas industry by ensuring that its programmes and activities aligned with the provisions of the PIA.
Holding the bid licensing round, he pointed out, was not discretionary, but an exercise in line with the statutory provisions of the PIA, which stipulates that the Commission should conduct licensing rounds to encourage the development of oil assets to grow the country’s oil and gas industry production capacity.
Although the PIA did not make the licensing round to be an annual exercise, Komolafe said the Commission resolved to make it so, to grow, preserve, and optimise the country’s hydrocarbon resources and output.
He said the Commission has begun recovering idle assets based on the ‘drill or drop’ provision in the PIA, which demands operators of oil assets to either develop and produce oil from allocated acreages, or allow such acreages to be awarded to others who are ready to develop them.
“We have been engaging with the industry to ensure that unexplored areas and resources are returned to production in line with the provisions in the PIA that speaks to ‘drill or drop’.
“We intend to revitalise these idle assets, as many of them remain unused, which is not the intent of the Petroleum Industry Act.
“So, as a Commission and as a regulator, we have started activating the ‘drill or drop’ provisions of the Petroleum Industry Act, which is intended to ensure that our assets do not remain idle. We are reintegrating them into the pool, and they will be available for bidding by interested parties in the next licensing round,” he said.
