Nigeria returns 13 oil blocks after 196 firms qualify for commercial bid

Orisemeke Benjamin

In a major development within Nigeria’s energy landscape, the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) has revealed that 196 companies successfully qualified for the commercial bid stage of the 2025 oil licensing round. However, 13 of the 50 oil blocks initially offered by the Federal Government failed to attract viable representation during the evaluation phase and will now be returned to the national licensing basket.

The Commission Chief Executive (CCE) of the NUPRC, Mrs. Oritsemeyiwa Eyesan, disclosed this on Tuesday during her opening remarks at the official Commercial Bid Conference held in Abuja, themed “Expanding Opportunities: Right Play, Right Place, Right Time.”

According to the Commission Chief Executive, while 50 oil and gas blocks across various terrains were initially placed on offer to local and foreign investors, only 37 blocks attracted active representation during the rigorous technical evaluation stage, with 140 participating entities submitting 196 bids.

Rigorous Bid Process and Basket Returns

Detailed breakdown of the competitive exercise revealed that out of nearly 300 initial expressions of interest, 286 companies formally applied for prequalification, resulting in 196 applicants advancing to the bidding phase. By the final submission deadline, 143 companies had submitted 200 technical and commercial bids covering the 37 assets.

“At the end of the exercise, we had 50 blocks on offer, but we only had representation for 37 of those 50 blocks. Thirteen of those blocks will be returning to the basket. We have a total of 140 participating companies showing interest through 196 bids,” Mrs. Eyesan stated.

She explained that the licensing round attracted a diverse mix of indigenous operators, international oil companies (IOCs), new entrants, and established industry players, describing the turnout as a resounding vote of confidence in the governance and economic stability of Nigeria’s upstream sector.

To guarantee maximum credibility, representatives from the Nigeria Extractive Industries Transparency Initiative (NEITI) observed both the bid opening and technical evaluation stages.

“The evaluation was rigorous. It was objective. It was simple. And it was to place assets in the hands of bidders capable of delivering the best overall long-term value,” the CCE said, adding that technical competence and operational capacity were prioritised over mere financial posturing.

“It wasn’t, and it isn’t, going to be just about your ability to be the highest bidder. We want to ensure that you have the right capabilities to deliver the asset, in addition to having the financial resources,” she asserted.

Key Metrics and Production Targets

The 2025 licensing round covers a broad footprint across diverse geological terrains, including 16 onshore blocks in the Niger Delta, 18 shallow-water blocks, one deep offshore block, three onshore blocks in the Benin Basin, four in the Anambra Basin, four in the Chad Basin, and four in the Benue Trough.

Unveiling the strategic national value embedded in the exercise, Mrs. Eyesan highlighted the potential reserve gains and immediate operational deliverables:

The assets available in the licensing round have the potential to add about 500 million barrels to Nigeria’s crude oil reserves.

Nigeria’s total hydrocarbon reserves currently stand at 37.01 billion barrels of crude oil and condensate, alongside 215.19 trillion cubic feet (TCF) of natural gas.

The 37 active assets are expected to unlock an additional minimum production of 300,000 barrels of crude oil per day (bpd) within the next three years.

The licensing round remains pivotal to achieving the Federal Government’s long-term goal of scaling national oil production to 3 million barrels per day by 2030.

“When I took office, my team and I made a clear pledge to carry out the Licensing Round according to the published schedule and to conclude both the technical and commercial bidding phase today, 21 July 2026. I am pleased to note that we have upheld this promise,” Mrs. Eyesan noted.

Strict Compliance and “Drill or Drop” Mandate

Addressing prospective winners, the NUPRC boss warned successful bidders against treating petroleum licences as decorative assets, emphasizing that commercial scoring will be determined by a weighted aggregate score combining signature bonuses, work programme commitments, and work programme performance security.

Issuing a stern warning, she reaffirmed the enforcement of the Petroleum Industry Act (PIA) 2021 statutory provisions:

“The award should not be a trophy. It shouldn’t be just a medal of honour. We expect that you’re going to work these assets. If you do not do anything in three years, I’m sorry, we will come for those assets. Our message is therefore clear: drill or drop.”

“The Government is not seeking speculative holders of acreage; it is seeking partners with the capacity, discipline and commitment to deliver measurable production and economic value,” Eyesan added.

Clarifying post-bid rules, she noted that emerging as the highest commercial bidder does not automatically grant a Petroleum Prospecting Licence (PPL). Winning bidders must satisfy mandatory post-bid conditions—including the payment of signature bonuses, first-year rents, provision of guarantees, and execution of legal contracts—within 90 days.

“Today’s exercise does not constitute a final grant. A winning bidder who fails to fulfil the prescribed conditions within 90 days of receiving this offer will have the offer invalidated. The commission may thereafter invite the reserve bidders in their order of ranking,” she clarified.

Mrs. Eyesan further revealed that President Bola Ahmed Tinubu has formally approved the commencement of the 2026 Licensing Round, encouraging unsuccessful applicants to prepare for upcoming opportunities.

Minister Reinforces Federal Government’s Commitment

Also speaking at the conference, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, stated that the commercial bid conference represents a monumental milestone in Nigeria’s energy governance, underscoring the administration’s policy alignment with the PIA 2021.

“The Federal Government, under the leadership of His Excellency, President Bola Ahmed Tinubu, remains firmly committed to creating an enabling environment that attracts investment, accelerates exploration and production, and unlocks the full value of Nigeria’s hydrocarbon resources,” Ekpo stated.

The Minister emphasized that the gas component of the acreage on offer is crucial to driving Nigeria’s flagship ‘Decade of Gas’ roadmap.

“New upstream investments will provide the foundation for increasing gas reserves, expanding domestic gas supply, supporting industrialisation, improving energy access, and strengthening our position as a leading supplier of natural gas to regional and global markets,” he said.

Ekpo remarked that fiscal and regulatory clarity under the current administration has drastically improved investor sentiment by guaranteeing business ease and regulatory predictability. He urged successful investors to move capital quickly to turn awarded acreages into active production fields.

Despite the positive regulatory momentum and strong investor turnout, environmental advocates and host community representatives continue to advocate for stricter operational safety, urging the regulator to ensure that incoming operators address ecological challenges such as oil spills and gas flaring in oil-producing areas.