How Nigerian oil companies can renew expiring licences before June 2025 deadline

• At slightest 40 lipid licences acceptable to expire successful June 2025 hazard non-renewal unless the Minister of Petroleum acts successful enactment with the Petroleum Industry Act
• These licences, mostly for marginal fields awarded successful the 2020 bid round, whitethorn person a three- oregon five-year hold depending connected institution performance.
• The Nigerian Upstream Petroleum Regulatory Commission is presently engaging with licence holders to determine connected declaration renewals

Legit.ng writer Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

Unless the Minister of Petroleum renews their licences successful compliance with the Petroleum Industry Act, astatine slightest 40 concern lipid licences that are owed to expire successful June 2025 hazard being lost.

At slightest 40 concern lipid licences that are owed to expire successful June 2025 hazard being lost. Photo Credit: Contributor
Source: UGC

The assorted licences granted to antithetic businesses connected 28 June 2022 volition expire connected 27 June 2025, according to the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) Upstream Concession Situation Report published successful May.

These see petroleum exploration permits issued to lipid corporations pursuing the completion of the 2020 marginal fields bid round. According to the NUPRC, the instrumentality allows for an optional hold of 3 oregon 5 years; however, the magnitude of the hold volition beryllium connected the company’s performance.

Smaller lipid blocks that person been developed but person not produced for much than 10 years are known arsenic marginal fields.

To springiness Nigerian indigenous oil and state companies the accidental to instrumentality a much progressive relation successful exploration and accumulation by owning and managing lipid blocks, the Federal Government launched the marginal tract programme successful the 1990s.

The 57 marginal lipid fields offered for lease astatine that clip had palmy bidders successful the 2020 marginal bid round.

Some of the companies that emerged arsenic winners included Matrix Energy, AA Rano, Ardova Plc, Duport Midstream, Genesis Technical, Twin Summit, Bono Energy, Deep Offshore Integrated, Odu’a Oil, MRS, and Petrogas.

Others were North Oils and Gas, Pierport, Metropole, Pioneer Global, Shepherd Hill, Akata, NIPCO, Aida, YY Connect, Accord Oil, Pathway Oil, Tempo Oil, and Virgin Forest, among others.

NUPRC information indicated that EOP Energy’s licence to run the Emohua tract of OML 22 volition expire adjacent month. EOP Energy is made up of Erebina Energy Resources Limited, Omega-Butter Marginal Fields Ltd., and Intessa Energy Ltd.

Similarly, the authorisation granted to Ardova Plc and Petrodev to tally the Olua tract of OML 25 done Ardogreen Energy volition besides expire connected the aforesaid day.

In an exclusive interview, Olaide Sonola, the commission’s Corporate Affairs Manager, stated that the result of ongoing engagements with these companies volition find whether their contracts are renewed.

FG is presently engaging with licence holders to determine connected declaration renewals. Photo Credit: Contributor
Source: Getty Images

This volition besides subordinate to the guidelines that the committee is developing, Sonola added.

“The instrumentality provides for an optional hold of 3 oregon 5 years, depending connected the terrain. The hold volition beryllium connected the company’s performance, the effect of ongoing engagement, and the guidelines we are moving on,” she said.

FG speaks connected withdrawing licenses of dormant lipid blocks

Legit.ng reported that Senator Heineken Lokpobiri, the State Minister of Petroleum Resources (Oil), threatened to instrumentality lipid blocks distant from owners who haven't developed them.

This comes arsenic the Federal Government of Nigeria has urged overseas lipid companies doing business successful the state to summation their concern successful the lipid and state industry, highlighting the information that the existent medication has offered each the incentives required to warrant creaseless and palmy operations.

In keeping with the propulsion to summation lipid production, Lokpobiri stated that the authorities volition commencement putting the Petroleum Industry Act's "drill oregon drop" provisions into effect successful 2025, with the Federal Government aiming to nutrient 2.06 cardinal barrels per day.

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Source: Legit.ng