Nigeria opens oil blocks for intl. investment

Nigeria has extended an invitation to international investors possessing both financial prowess and technical expertise for 12 onshore and deep-water oil blocks, according to Reuters citing the country’s oil regulator speech at a global oil conference in Houston, Texas.

As Africa’s leading oil producer, Nigeria initiated this year’s licensing round on April 29, aiming to intensify the exploitation of its substantial reserves, estimated at 37.5 billion barrels of crude oil and 209.26 trillion cubic feet of natural gas.

Gbenga Komolafe, head of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), affirmed Nigeria’s dedication to conducting the licensing round with fairness, competitiveness, and transparency, ensuring equal opportunities for both domestic and international investors.

Previous reluctance among investors to participate stemmed from concerns over the lack of transparency in the award process, leading to instances where companies lacking drilling capabilities secured oil fields, prompting threats of award cancellations.

Komolafe also disclosed that, in addition to the 12 blocks, the seven deep offshore blocks from the 2022 mini-bid round would also be finalised alongside this licensing round, bringing the total to 19 oil blocks offered to investors in 2024.

Beyond technical and commercial prowess, the regulator emphasised its scrutiny of bidders’ plans to align with Nigeria’s net-zero carbon emissions objectives, eliminate gas flaring, and prevent pollution of rivers and farmlands.

Despite being a member of the Organisation of the Petroleum Exporting Countries (OPEC+), Nigeria has witnessed a decline in oil production from approximately 2 million barrels per day a decade ago to just over 1.3 million barrels per day. Major oil companies are shifting their focus from onshore fields, vulnerable to sabotage and frequent spill-related compensation claims, to deepwater fields with fewer disruptions.