FG Threatens to Revoke 33 Unused Oil Exploration Leases
- The FG is planning to withdraw the licenses that are yet to be used for oil explorations
- Data shows that 60% of licenses issued to local and foreign oil firms have expired
- The regulator is no longer willing to let the companies hold on to leases indefinitely
Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.
Nigerian Upstream Petroleum and Regulatory Commission has revealed that the federal government plans to revoke unused oil exploration leases.
Source: Getty Images
Gbenga Komolafe, the Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission, disclosed this to Reuters.
According to the CEO, only a few companies with viable technical and financial backup would get to keep their leases.
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Review subject to terms and condition
Komolafe noted that the review of new leases and awards would now depend on specific terms and conditions.
He said:
“Based on PIA (Petroleum Industry Act), the commission is focused on delivering value for the nation so only firms that are technically and financially viable will keep their leases.”
NUPRC data shows roughly 53 exploration leases have been granted since 2003; nevertheless, 60% of the prospecting licenses granted to domestic and international oil companies have expired.
This indicates that 33 licenses, including four pending due to contract disputes, have since expired and have not been renewed.
It appears the regulator is no longer prepared to allow the corporations to keep their leases indefinitely, even though the leases haven't been cancelled yet.
The regulator was given the authority to examine the technical and financial capacities of businesses that possess oil exploration leases by the PIA, passed in 2021.
Due to growing levels of insecurity, sabotage of oil infrastructure, and legal battles with Niger Delta communities, oil majors are pulling out of onshore and shallow water assets, which has resulted in a dearth of investments in oil exploration in the nation.
Since then, the industry has been hindered by low exploration activity investments and low crude oil output due to theft and pipeline vandalism.
Legit.ng reported that the Nigerian government said it will revoke marginal oil field licenses granted to some companies in 2021.
In a recent report, it also threatened to revoke the licenses of inactive modular refineries in the country.
NNPC makes senior management team changes, announces 3 new appointments
Legit.ng reported that the Nigerian National Petroleum Company (NNPC) Limited has announced three changes to its senior management team.
This was disclosed in a statement signed by Garba Deen Muhammad, the company's chief corporate communications officer.
According to the statement released on Saturday, September 16, 2023, NNPC's three Executive Vice Presidents due to retire in 2024 have been asked to leave immediately.
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