Nigerian Upstream Petroleum Regulatory Commission, NUPRC, has signed a Production Sharing Contract, PSC, for Petroleum Prospecting Licences 2000 and 2001 with NNPC Limited and the TotalEnergies–Sapetro Consortium.
Speaking at the signing ceremony on Monday in Abuja, NUPRC Chief Executive, Mr Gbenga Komolafe, described the agreement as a milestone that marked a new chapter in Nigeria’s upstream sector, in line with the Petroleum Industry Act, PIA.
The licences, awarded to TotalEnergies and its partner South Atlantic Petroleum, SAPETRO, under the 2024 Licensing Round, also signify the formal conclusion of the round.
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According to Mr Komolafe, the PSC launches a committed work programme aimed at unlocking deepwater geological potential, expanding reserves, boosting production, and enhancing Nigeria’s energy security.
He commended President Bola Tinubu for his bold reforms and directive that undeveloped assets be returned for rebidding and reallocation to competent bidders in line with the PIA.
Mr Komolafe also highlighted the impact of the 2024 Executive Orders—#40 on fiscal incentives, #41 on local content, and #42 on cost efficiency and contract timelines—saying they had catalysed significant investment inflows and set the stage for shared prosperity.
“The Awardees of 2000 and 2001 Licensees clearly have become beneficiaries of the laudable initiatives and reforms of Mr president,” he said.
At the signing of the PSC, he said the licences, awarded to TotalEnergies and its partner South Atlantic Petroleum (Sapetro) in the 2024 Licensing Round, marked a new chapter in the oil and gas upstream sector.
He urged the TotalEnergies and other potential investors to take advantage of the right regulatory, fiscal and governance regime as enthroned by the NUPRC, with the president’s support by participating in the next Licensing Round.
“I congratulate the TotalEnergies with over 60 years operations in Nigeria and holding 80 per cent contractor interest, as well as Sapetro with 30 years operations and holding 20 per cent contractor interest, on their success in the Licensing Round,” he said.
Recall that the Licensing Round was based on a fair, transparent and competitive bidding process in line with Section 73 of the PIA.
Hence, he described the award of these two offshore blocks, spanning about 2,000 square kilometres in the prolific Niger Delta Basin, as a direct product of the transparent, competitive, and reform-driven framework introduced under the PIA.
He commended the NNPC Ltd. and contractors (TotalEnergies & Sapetro) for their commitments in exploration and production activities in Nigeria, adding that the successes recorded in Egina, Akpo and other assets were highly commendable.
“The commission, working hand-in-hand with stakeholders, especially NNPC Limited as the concessionaire, devoted significant time and expertise to develop a new standardised PSC template that reflects the spirit and intent of the PIA,” he said.
He advised the parties to imbibe swift and technically sound exploration, leading to early Final Investment Decisions, while striving to deepen local content, create jobs, empower businesses, develop and produce the asset in line with decarbonisation principles.
Speaking, Bashir Ojulari, Ground Chief Executive Officer, NNPC Ltd. thanked the Federal Government, NUPRC and the TotalEnergies leadership on the bold step taken to reopen the deep water exploration space.
“This particular PSC is unique in many respects. I just want to highlight a few.
“It is the first in the deep water offshore PSC following the successful completion of the 2024 licensing round.
“It is the first PSC that comprehensively covers in scope both crude oil and natural gas. It is the first PSC with robust gas terms including a profit gas split that incentives monetisation of non-associated gas.
“So this is quite front leading from as you know, following the PIA, the whole non-associated gas in the deep water is one of the critical areas that we needed to really push the frontiers in Nigeria,” he said.
Mr Ojulari said the PSC had robust fiscal terms, including a signature bonus of 10 million dollars, production bonus of two million barrels and four million or cash equivalent on attainment of 35 million barrels and 100 million barrels production respectively.
“We will ensure there are no gaps. It will bring NNPC Limited closer to achieving the target of three million barrels per day and an additional investment of 60 billion dollars by 2030,” he said.
The Managing Director of TotalEnergies, Mathieu Bouyer, thanked NUPRC for the work done in ensuring extensive deliberations, rigorous evaluations and transparent bid process concluded in December, 2024.
“We are honoured to be the first International Oil Company to be awarded an exploration block in 10 years and that our joint bid with our partner Sapetro was successful.
“We are eager to progress swiftly and responsibly with the implementation of the agreed work programme for both blocks,” he said.
NAN
By Ibrahim Ramalan
