April 16, 2024

Nigerian Government sets to open bidding for deep offshore oil blocks in November

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Oredola Adeola

The Nigerian Government has revealed plan to auction 7 deep offshore oil and gas blocks for the first time since 2007, in November.

Engr. Gbenga Komolafe, Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), made this known in an interview with the Reuters on Saturday.

According to him, the commission intends to conduct a transparent bidding process for the oil blocks.

EnergyDay gathered that there are 173 active oil blocs out of the total of 388 oil blocks (including the oil Prospecting Leases (OPL) and Oil Mining Lease (OML)) in the country.

In May, 2001 some Nigerian deep offshore exploration licences were auctioned by the now defunct Department of Petroleum Resources (DPR).

NUPRC’s decision to auction the deep offshore assets is coming months after the conclusion of the sales and allocation of 57 marginal fields to indigenous players in the industry.

Engr. Komolafe however said, “We will announce by next month the intention to conduct a transparent bidding round for seven oil blocks. All the blocks are in the Lagos waters, not in the Niger Delta, with the added advantage of its proximity to the export-free zone in Lagos.’’

EnergyDay also confirmed that while the Oil Operating License 309, now OML 113, was awarded to Yinka Folawiyo Petroleum (YFP) with joint venture comprising Chevron Nigeria Deepwater, Vitol Exploration Nigeria, Panoro Energy, Energy Equity Resources and Jacka Resources in 1991.

YFP controls 60 percent stake while other JV partners share 40 percent.

Following the successful discovery of the Aje field, the licence was converted to OML 113 in 1998 with a term of 20 years. The field came on stream in May 2016.

In 1997, the Aje-2 appraisal well was drilled 1km east of the Aje-1 well, while Aje-3, was drilled by Transocean’s Sedco 709 semi-submersible rig in 2005.

In the first quarter of 2008, another appraisal well called Aje-4 was drilled by the Transocean Deepwater Pathfinder drill-ship to carry out a complete appraisal of the field. The field was declared a commercial prospect in February 2009.

EnergyDay gathered that auctioning more oil wells in Nigerian is now an attractive venture, because of the passage of the Petroleum Industry Act(PIA) which brings clarity to applicable fiscal obligations for production by investors.

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