By Editor

The Federal Government of Nigeria has reduced the signature bonus for oil blocks in the 2025 licensing round to between $3 million and $7 million, down from the previously approved $10 million, as part of efforts to lower entry barriers and attract more investors.

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) disclosed this in an update published on its website, noting that the revised figures were approved by the Minister of Petroleum.

“Interested in one of the oil blocks listed for the 2025 Licensing Round? The Nigerian government has graciously reduced the signature bonus to between $3m and $7m,” the commission stated.

“All bidders shall be required to submit a bid within this range as approved by the minister for the reduction of entry barriers.”, it added.

The reduction represents a further cut from the 2024 adjustment, when the Federal Government slashed signature bonuses from as high as $200 million to $10 million. At the time, the Chief Executive of NUPRC, Gbenga Komolafe, said the commission benchmarked Nigeria’s fiscal terms against peer jurisdictions such as Brazil and concluded that a significant reduction was necessary to improve competitiveness.

A signature bonus is a non-refundable payment made by a contractor to the government upon the signing of a petroleum agreement. Companies awarded oil or gas assets are required to pay the bonus before commencing operations.

Under the revised structure, deepwater assets—which previously attracted a $10 million signature bonus—will now require up to $7 million, while shallow water and onshore assets have been reduced to as low as $3 million.

The commission also clarified that signature bonuses must be paid in United States dollars. “The designated signature bonus account is United States dollar-denominated,” the NUPRC said.

According to the regulator, successful bidders in the 2025 licensing round will be issued a Petroleum Prospecting Licence (PPL). The licence grants the holder the exclusive right to drill exploration and appraisal wells, the non-exclusive right to conduct petroleum exploration activities within the licensed area, and the right to dispose of hydrocarbons produced during testing.

The licence will have an initial duration of three years, with a possible three-year extension for onshore and shallow water assets, while deepwater and frontier acreages will have an initial tenure of five years.

The NUPRC added that the licensing round will follow a two-stage bidding process, comprising a qualification stage and a bid stage.

The qualification stage will involve the submission and evaluation of applications by interested companies or consortia, after which only shortlisted bidders will proceed to the bid stage and execute a confidentiality agreement.

At the bid stage, shortlisted applicants will submit technical and commercial bids in line with the applicable regulations, guidelines, and bidding documents.

The commission also warned that no bidder—whether acting alone or as part of a consortium—may apply for more than two assets in total across all applications.

By Ambrose Nnaji

NNPC E&P Limited (NEPL), the flagship upstream subsidiary of NNPC Limited, has recorded a historic production milestone, achieving a daily output of 355,000 barrels of oil per day (bpd) — its highest level since 1989.

The achievement marks a major breakthrough for Nigeria’s upstream oil and gas sector and underscores the impact of sustained reforms, operational discipline, and strategic asset management within the national oil company’s exploration and production arm.

Data from the company show that NEPL’s transformation has been both rapid and measurable. Average daily production rose by 52 per cent, increasing from 203,000 bpd in 2023 to 312,000 bpd in 2025. The latest peak output of 355,000 bpd reflects the culmination of this growth trajectory and positions NEPL as a critical driver of Nigeria’s production recovery.

Industry analysts note that the milestone is not the result of short-term interventions, but of a deliberate strategy focused on operational excellence, structured field development, and strengthened asset integrity. After years of volatility in Nigeria’s upstream sector, NEPL’s performance demonstrates that sustained output growth is achievable with the right leadership, systems, and workforce alignment.

Beyond the numbers, the record production provides tangible momentum toward Nigeria’s national oil production ambitions. Presidential targets of reaching 2 million barrels per day by 2027 and 3 million barrels per day by 2030 have often been viewed as aspirational. NEPL’s delivery, however, offers concrete evidence that these goals are increasingly attainable.

Commenting on the development, Group Chief Executive Officer of NNPC Limited, Engr. Bashir Bayo Ojulari, described the milestone as clear proof that Nigeria’s energy sector revival is already underway.

“By exceeding its own production benchmarks, NEPL has confirmed that the essential building blocks for scaling national output are being firmly established. This achievement demonstrates that Nigeria’s production machinery — equipment, processes, capabilities, and partnerships — can be operated with commercial discipline to deliver real and positive outcomes”, Ojulari said.

He added that the record performance strengthens confidence both locally and internationally, assuring partners and investors that Nigeria remains committed to its role as a reliable energy supplier in the global market.

Also speaking, Executive Vice President, Upstream, NNPC Limited, Udy Ntia, stressed that the significance of the achievement goes beyond the headline figure of 355,000 bpd.

“In an industry where shortcuts can deliver short-term gains but cause long-term damage, NEPL is making a different statement. Sustainable growth must be anchored on responsible operations. Scaling production should never come at the expense of worker safety, community wellbeing, or environmental protection”, Ntia said.

According to him, NEPL’s approach reflects a broader shift from extraction at all costs to sustainable value creation — a standard increasingly demanded of modern energy companies seeking global relevance and long-term competitiveness.

Managing Director of NEPL, Nicolas Foucart, also linked the record output to the wider transformation taking place across NNPC Limited. He attributed the performance to clear leadership direction, strong partnerships founded on accountability, and a workforce committed to delivering measurable results.

“This is a story shaped by leadership that sets a clear course, partnerships built on alignment, and people whose dedication is turning strategy into performance. Our people, processes, and principles are the true engines behind this success. We are building for tomorrow, not just celebrating today”, Foucart said.

He noted that the implications of the milestone extend far beyond higher production figures. For Nigeria, increased output translates into improved national revenue, enhanced energy security, and a more resilient economic base at a time of global energy uncertainty.

“NEPL has not only produced more hydrocarbons; it has helped restore confidence in what Nigeria’s energy sector can achieve when the right systems, culture, and discipline are in place,” he added.

As Nigeria continues efforts to stabilise and grow its oil and gas industry, NEPL’s record-setting performance stands as a strong signal that the upstream sector is regaining its footing — and that sustained production growth is once again within reach.

By Ambrose Nnaji

The President of the Petroleum Technology Association of Nigeria (PETAN), Engr. Wole Ogunsanya, has stated that the cost of delivering technical services in Nigeria’s oil and gas industry remains the most competitive on the African continent.

Speaking at a town hall session during the 14th Practical Nigerian Content (PNC) Conference and Exhibition in Bayelsa State, Ogunsanya provided a comparative analysis of project costs across Africa and other oil-producing regions.

He stressed the need to distinguish between capital expenditure (CAPEX) and operating expenditure (OPEX) when evaluating Nigeria’s cost environment, noting that while the country’s CAPEX rates are among the lowest in Africa, high OPEX figures are largely driven by evacuation and security challenges.

According to him, PETAN has conducted long-term analyses of cost components across various markets using CAPEX and OPEX indicators. In Nigeria’s case, the most significant cost drivers are linked to crude and gas evacuation, pipeline vandalism, and the widespread use of barges and vessels — an alternative that can cost as much as US$12 per barrel. These additional costs often include payments to security personnel for escort services.

Ogunsanya, who is also Chairman/CEO of Geoplex Drillteq Limited, explained that despite these challenges, Nigeria still offers some of the lowest service rates in Africa. For instance, hiring a land rig in India costs around US$60,000 per day, compared to as low as US$30,000 in Nigeria. He attributed this partly to the country’s local content framework, which, in his words, “subsidises oil and gas production” even though the benefits are not always visible to market observers.

The PETAN President also warned about the distortive impact of “portfolio companies” — entities that lack the operational capacity to execute oilfield services but secure certifications and project approvals through questionable means. He revealed that some of these firms had previously obtained the Nigerian Content Equipment Certificate (NCEC), gained registration on the Nigerian Petroleum Exchange (NIPEX) and won service contracts despite lacking assets.

To address this, he referenced the Presidential Directive on Local Content Compliance Requirements, issued on March 24, 2024, which bars such portfolio companies from participating in the oil and gas industry. The directive also mandates that bidders demonstrate verifiable capacity before being cleared for project execution.

Ogunsanya urged the Nigerian Content Development and Monitoring Board (NCDMB) to allow PETAN specialists provide technical guidance on equipment requirements for industry operations. He added that support from the Federal Government and NNPC Ltd would help PETAN benchmark project costs in other markets, allowing Nigeria to verify cost claims made by international oil companies (IOCs) and indigenous operators.

At the town hall session moderated by the NCDMB’s General Manager, Corporate Communications Division (CCD), Obinna Ezeobi, participants also deliberated on requirements for obtaining the NCEC and the accessibility of the Nigerian Content Intervention Fund (NCIF).

Engr. Abayomi Bamidele, NCDMB’s Director of Capacity Building, disclosed that the Board has developed “Guidance Notes” outlining mandatory and category-specific documents required for the NCEC. He advised applicants to restrict their submissions to one or two NCEC categories in which they have proven capacity, rather than attempting to register for all eight categories.

Bamidele and Ezeobi further announced that the Board will soon open a dedicated platform for complaints and enquiries related to the NCEC process.

On financing, Uchendu Ossaowa, NCDMB’s Director of Finance and Personnel, clarified that Research and Development (R&D) companies cannot access the US$400 million Nigerian Content Intervention Fund, as it is reserved for contributors and firms with ongoing contracts with operating companies.

However, Abdulmalik Halilu, Director of Corporate Services, noted that R&D-focused firms can benefit from the US$50 million Nigerian Content Research and Development Fund, and can also participate in NCDMB-backed innovation hackathons designed to support indigenous technology development.

The 14th PNC Conference and Exhibition also featured a technical facility tour, where delegates visited an oil and gas service company specializing in electrical systems and integrated energy solutions.