The Nigerian Upstream Petroleum Regulatory (NUPRC) says the 2020 marginal field bid round exercise generated about N200 billion as well as $7 million in revenue for the federal government (FG).
Gbenga Komolafe, chief executive officer (CEO), NUPRC, made this known on Tuesday while issuing petroleum prospecting licences (PPL) to successful bidders in Abuja.
Marginal fields are smaller oil blocks developed by indigenous companies not exploited in the last ten years.
In May 2021, the Department of Petroleum Resources (DPR) — now NUPRC — completed the first successful bid programme after 18 years of bureaucratic bottlenecks.
Successful companies include Ardova Plc, Matrix Energy Ltd, Sun Trust Oil Company Limited, Deep Offshore Integrated Service Ltd, Island Energy Ltd, Sigmund Oil Field Ltd, among others.
Out of the 665 entities that expressed interest in the exercise, Komolafe said 161 PPLs were awarded to successful 2020 marginal fields companies while out of the 57 fields presented in the bid round, 41 were fully paid for.
He said 37 fields were also issued with the PPL, having satisfied all conditions for the award.
Komolafe said the marginal fields award initiative began in 1999 and was borne “out of the need to entrench the indigenisation policy of government in the upstream sector of the oil and gas industry and build local content capacity.”
He added that the scheme was also targeted at creating employment opportunities and encouraging increased capital inflow to the sector.
“Since its inception, a total of 30 fields have been awarded, with seventeen 17 currently producing. A breakdown of the allocation of the fields to indigenous operators is as follows: two fields awarded in 1999, 24 in 2003/2004, one each in 2006 and 2007, and two in 2010. 10 years later, in 2020, 57 fields were put up for bidding,” he said.
“It is significant to note that the passage of the Petroleum Industry Act has brought an end to the era of marginal field awards. Section 94(9) of the Act states that ‘no new marginal field shall be declared under this Act’.
“Accordingly, the minister shall now award PPL on undeveloped fields following an open, fair, transparent, competitive, and non-discriminatory bidding process in line with sections 73 and 74 of the Act.”
Meanwhile, Komolafe said revenue earnings in the country is not reflective of the upsurge in international prices of crude oil owing to sabotage, theft, as well as other operational challenges.
Consequently, he urged potential licensees to take advantage of the current market realities and promptly bring their fields to production.
Source: Top Stories