The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced the process heralding this year’s mini bid round. At a briefing on Wednesday in Abuja, NUPRC said it has invited both foreign and local oil industry players to apply for seven facilities
The Commissions chief executive officer, Mr. Gbenga Komolafe, said this year’s mini bid round, the offshore blocks will be putting on offer assets covering an area of approximately 6,700 km2 in water depths of 1,150m to 3,100m.
The success of the exercise, he explained, will ensure all stakeholders gain value from the country’s resources, while paying close attention to reduction in carbon emissions, as well as overall environmental, social and governance (ESG) considerations.
The offshore assets are located off the city of Lagos, rather than off the coast of the Niger Delta further to the east where most of the country’s oil industry are located
Putting up the assets for sale is coming on the heels of the disposal of 57 marginal fields after a long and winding process to ramp up the country’s struggling oil production efforts.
NUPRC had earlier on resumed a separate bidding round for firms interested in commercializing gas that is burned off – or “flared” – by oil producers.
Nigeria’s oil output fell to a multi-decade low of just over 900,000 barrels per day in September and had almost halved since the first quarter of 2020, until the recent resurgence of production after what looked like a declaration of a national emergency on oil losses in the sector.
Crude oil theft and vandalization of pipelines had been blamed for the shutting down of oil exploration in Nigeria. Recently, deepwater production led by international companies such as Shell Plc and TotalEnergies has accounted for about 35% of oil output but its share has risen this year as onshore operators have struggled.
Komolafe hinted that a dedicated programme portal (br.nuprc.gov.ng) for the mini bid round had been published by NUPRC. The portal, he explained, provides further information about the bid round.
A pre-bid conference has been slated for January 16, 2023 to provide potential applicants with the opportunity to get further information on the mini bid round exercise.
Interested applicants and companies will be invited to submit their pre-qualification applications by January, 31, 2023, the commission stated
“NUPRC will continue to provide further details and roadmap for this international competitive mini bid round in due course.
According to Komolafe, the bid round is the first in a series, aimed at further development of the prospective petroleum basin which will be held in accordance with the Petroleum Industry Act 2021 (PIA).
“The mini bid round is a market-driven programme and will follow a transparent and competitive procurement process designed to attract competent third-party investors from across the world, that have the capability and proficiency in operating in deep-water environment,” Komolafe explained.
The commission head said this year’s mini round would build on the successes of the last bid round held in April 2007, during which a total of 45 blocks, drawn from the inland Basins of Anambra, Benue and Chad; the Niger Delta Continental Shelf; Onshore Niger Delta and Deep Offshore were put on offer.
The 2007 bid round, he recalled, was held under a different regulatory regime (the Petroleum Act, 1969) and generated massive interest and participation with its attended revenue which made the exercise a success.
Komolafe however refused to divulge the revenue projection of the bid round. “It is a bit premature to have an accurate revenue projection, until this is done,” he said, but added that the NUPRC may have its own reserve bid, which may not be made available until the process begins.
By Bosco Agba