FG Awaits Bid For Oil Blocks, Reduces Entry Price by $3 Million
- The federal government is making its oil block bid attractive with the reduction of the signature bonus for the 2025 oil licensing round
- Investors now only need about $3 million to $7 million to have a chance to bid for oil well
- Winners will receive a Petroleum Prospecting Licence with exclusive rights to drill and explore, valid for three years (onshore or shallow water) or five years (deepwater), with possible extensions
The federal government has reduced the signature bonus for the 2025 oil licensing round from the previously approved $10 million to a new range of $3 million to $7 million.
The move is targeted at lowering entry barriers and attracting fresh investment into Nigeria’s upstream sector.
Source: Getty Images
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) confirmed the new pricing in an update published on its website, signalling one of the most significant adjustments to investment requirements in recent licensing rounds.
Lower price for oil blocks
According to the regulator, prospective investors bidding for oil blocks will now be required to submit signature bonus offers within the new range.
The commission announced:
"Interested in securing an oil block in the 2025 Licensing Round? The government has now set a new, reduced signature bonus ranging between $3 million and $7 million."
It added that all bidders must comply with the new ministerially approved benchmark intended to ease financial burden for new entrants.
Punch reports that the revised fee marks a further reduction from 2024, when the government lowered the signature bonus from around $200 million to $10 million to revive investor interest.
At the time, the NUPRC Chief Executive, Gbenga Komolafe, said the agency benchmarked Nigeria’s rates against countries like Brazil and found the need to adjust downward to remain competitive.
Under the previous framework, deepwater assets attracted a $10 million bonus, while shallow water and onshore blocks required $7 million. The fresh review pushes the figures down to $7 million for deepwater and $3 million for shallow and onshore fields.
Source: UGC
Benefits for investors
The commission also clarified that signature bonus payments remain strictly dollar-denominated and cannot be made in naira. Successful bidders in the ongoing round will receive a Petroleum Prospecting Licence granting exclusive rights to drill exploration and appraisal wells, conduct petroleum operations and dispose of crude oil and gas produced during testing.
Each licence carries an initial duration of three years for onshore and shallow waters with an additional possible three-year extension, while deepwater licences will run for five years.
NUPRC stated that the allocation will follow a two-stage bidding process consisting of qualification and bidding phases. Only applicants who scale the pre-qualification hurdle and sign a confidentiality agreement will proceed to submit commercial and technical bids.
Bidders are restricted to applying for a maximum of two assets, whether individually or through consortium participation.
Details of the 50 oil blocks in the 2025 licensing round can be found on the NUPRC website.
Oil production in Nigeria on the rise
Earlier, Legit.ng reported that Nigeria’s crude oil production saw a significant leap in July 2025, rising to 1.71 million barrels per day.
Data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) confirmed the development.
The figure comprised 1.507 million barrels per day of crude oil and 204,864 barrels per day of condensates.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
