The NUPRC, on behalf of the federal government stated that it was ready for the issuance of Oil Prospecting Licenses (OPL) to the successful awardees of the oil marginal fields in the 2020 bid rounds. The license issuance will be made in fulfillment of the promise made to the winners at the beginning of the year, according to the provisions of the Petroleum Industry Act (PIA), 2021. Some of the bid winners are North Oil and Gas, Pierport, Metropole, Accord Oil, Virgin Forest, Pioneer Global, Shepherd Hill, Pathway Oil, Akata, YY Connect, Tempo Oil, NIPCO, Aida, and others.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), formerly known as the Department of Petroleum Resources (DPR) is a body concerned with the issuance of license that is required to run a company or facility that has to do with the Oil and Gas industry in Nigeria, and compliance to the industry’s regulations. Its mission is to ensure sustainable development of Nigeria’s Upstream Petroleum Resources through effective regulatory practices, while entrenching world-class professionalism, accountability, and transparency.
Oil Prospecting License to winners of the marginal oil fields bid round.
An Oil Prospecting License (OPL) is granted by the Federal Government to a company or joint venture to prospect for petroleum resources. The licensee is usually granted the license for the conduction of extensive exploration activities, removal and disposal of commercially feasible petroleum discovered during prospective operations. The license is granted for a stipulated period of time, determined by the Minister of Petroleum and usually not exceeding five years. If peradventure after the stipulated time, the company has not discovered or fulfilled its obligation, the license will be ceded back to the government.
The marginal oil fields bid round, commenced in 2020, had been faced by many bureaucratic challenges that has hindered the winners from beginning the development of the fields over one year after they were officially handed the initial certificates. From 591 companies that applied for the pre-qualification, the regulator shortlisted 161 companies to progress to the final stage, putting up 57 marginal fields spanning land, swamp and offshore, for lease. Some of the winners during that time were; Matrix Energy, AA Rano, Andova Plc, Duport Midstream, Genesis Technical, Twin Summit, Emadeb Energy, Bono Energy, Deep Offshore Integrated, Oodua Oil, MRS, and Petrogas.
Award winners decry delay in promise fulfillment.
The award winners decried the delay in the commencement of the development of the fields, noting that they had been paying heavy interests on the loans that were borrowed for the payment of the transactions, notwithstanding the non-productivity of the loan for over one year. The Regulatory Commission, in January, revealed that the 2020 marginal field bid round that was concluded on the 30th of May, 2021, had yielded over N174.944 billion, with the half payment of 30 fields owners and two fields stalled by court cases.
The NUPRC Chief Executive, Engr. Gbenga Komolafe, stated that during the event of the issuance of licenses to the bid winners of the marginal oil fields, there would also be the unveiling of the implementation template for the Host Communities Development Trust Fund for the commencement of the provisions under Section 325 of the PIA, 2021. He also mentioned that restiveness in the host communities would be positively impacted, thereby guaranteeing seamless operations and boosting the confidence of investors.
Nigeria’s oil production declines, FG pledges improvement by August.
There is a huge void between Nigeria’s oil production and the monthly allocation given to it by the Organization of Petroleum Exporting Countries (OPEC). However, The Minister of State for Petroleum, Mr. Timipre Sylva, affirmed that it will be improved by August. The inability to meet up with the expected allocation of OPEC was blamed on massive theft. According to OPEC, although Nigeria surpassed 1.7 million BPD(barrels per day) for the month, its inefficiency is as much as 700,000 barrels per day for the month. The country’s oil production has deteriorated a lot in previous months, however the federal government initiated a 10-man professional team to access a report preceding the reactivation of about 3,000 shut-in oil strings. According to the authorities, this step would improve production in coming months.
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