NUPRC: NNPCL, TotalEnergies-Sapetro seal PSC deal on 2 offshore oil blocks

– NNPCL targets $60bn investment by 2030

By Obas Esiedesa, Abuja

The Nigerian National Petroleum Company Limited (NNPCL) and the TotalEnergies-Sapetro Consortium on Monday signed a Production Sharing Contract (PSC) for Oil Prospecting Licences (OPL) 2000 and 2001 located in the offshore Niger Delta Basin.

The deal, which covers crude oil and natural gas production, comes with a signature bonus of $10 million.

Speaking at the signing ceremony at the headquarters of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Commission Chief Executive, Engr. Gbenga Komolafe, said the two oil blocks span about 2,000 square kilometres.

Komolafe described the agreement as a turning point for Nigeria’s oil and gas industry, urging investors to leverage the stable regulatory, fiscal, and governance framework provided under the Petroleum Industry Act (PIA) 2021.

“Permit me to congratulate TotalEnergies, with over 60 years of operations in Nigeria and holding 80% contractor interest, as well as Sapetro, with 30 years in the sector and holding 20% contractor interest, on your success in the Licensing Round. Recall that the exercise was based on a fair, transparent, and competitive bidding process in line with Section 73 of the PIA.

“The award of these two offshore blocks, spanning about 2,000 square kilometres in the prolific Niger Delta Basin, is a direct product of the transparent, competitive, and reform-driven framework introduced under the PIA,” he said.

On his part, the Group Chief Executive Officer of NNPCL, Engr. Bayo Ojulari, said the company, as concessionaire, would support the consortium to ensure timely execution of the project.

Ojulari disclosed that NNPCL is committed to ramping up Nigeria’s crude oil output to three million barrels per day and attracting about $60 billion in investments into the sector by 2030.

According to him, “The PSC has robust fiscal terms. There is a signature bonus of $10 million; a production bonus of two million barrels; and an additional bonus of four million barrels or cash equivalent upon attaining 35 million barrels and 100 million barrels respectively. These provisions incentivize performance, which we consider very positive.

“There is a crude profit oil split based on curative production, and a gas profit split based on associated gas sales, not just production. Cost recovery is capped at 70%, ensuring a steady flow of production revenue into the Federation. Production bonuses, applicable royalty rates, and clearly defined cost parameters are all included.”

Ojulari stressed that the terms of the PSC address gaps in previous contracts, enhancing the Federation’s share while ensuring competitive returns for contractors.

“This PSC is a major milestone that underscores the regulator’s commitment to implementing the PIA. It will bring NNPCL closer to achieving its target of three million barrels per day and securing an additional $60 billion in investment by 2030,” he added.

In their separate remarks, the Managing Director/CEO of TotalEnergies, Mr. Matthieu Bouyer, and the Managing Director of Sapetro, Mr. Chukwuemeke Anagbogu, congratulated Nigeria for successfully completing the 2024 oil licensing round, the first under the PIA.

Bouyer said: “That in itself is a big success and a sign that Nigeria is setting the right conditions to attract investors. This moment follows an open and transparent bid process concluded in December 2024. We are honoured, as TotalEnergies and Sapetro, to be the first international consortium awarded an exploration block in over 10 years.”

On his part, Anagbogu described the blocks as strategically important to Nigeria, noting that, “As our current assets mature, these new licences provide a clear path to increasing our reserves base and assuring long-term production growth.

“By investing in these assets, we reaffirm our commitment to the government’s vision for responsible resource development, local content advancement, and inclusive economic progress,” he stated.

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