NUPRC warns non-performing oil licence holders: Meet work commitments by Oct 31 or lose acreages
NUPRC has warned holders of non-performing oil licences from the 2020 Marginal Field, 2022/2023 Mini Bid, and 2024 Licensing Rounds that they risk losing their acreages if they fail to meet approved work commitments under the PIA 2021's "Drill-or-Drop" provisions. Operators have until October 31, 2026, to disclose compliance status, identify obstacles, and submit revised plans for fulfilling obligations.
This affects 62 successful awardees holding deep offshore, shallow-water, and onshore acreages across Nigeria. Failure to comply could trigger licence revocation, refusal of extensions, or seizure of work performance securities. The NUPRC aims to boost national oil and gas production by ensuring licensed acreages are actively developed, directly impacting government revenue and energy security. The regulator cited legal basis in PIA Sections 77, 78, 88, 96, and 97, warning that enforcement may include calling in performance securities and initiating revocation proceedings.
Licence holders must submit details of their compliance with work programmes, specific constraints (financing, rig availability, insecurity, host community engagement, infrastructure, regulatory approvals, partner disputes), proposed mitigation measures, and revised implementation timelines by October 31, 2026. The NUPRC will facilitate solutions where possible but stressed that engagement won't extend licence terms or excuse contractual obligations—internal partner disagreements don't exempt operators. For context, NUPRC recently reduced signature bonuses for the 2025 licensing round to $3-7 million (down from $10M in 2024) to attract investment.
Will this enforcement drive actually increase Nigeria's oil production, or will many operators struggle to meet commitments due to persistent industry challenges?