2024 Oil Round: Growing opportunities in oil, gas sector.

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) awarded 25 oil exploration and production licenses to a diverse group of bidders, which include international majors and indigenous companies.

This development signals a renewed focus on revitalising the sector, attracting foreign investment and boosting energy security.

The awarded blocks are expected to unlock billions of dollars in investment, increase oil reserves and boost production capacity.

This not only promises economic growth and stability but also demonstrates continued global interest in Nigeria’s oil resources.

As the winners embark on their exploration journey, the success of this initiative hinges on the effective implementation of policies and support structures to guide these new ventures toward success.

Mr Gbenga Komolafe, the Commission Chief Executive of NUPRC, said, “The bid round is in line with the government’s commitment to transforming the upstream oil sector.

“This development would bolster Nigeria’s oil production capacity and enhance its competitiveness on the global stage.”

Komolafe also highlighted that the awards demonstrate the continued global interest in Nigeria’s oil resources in spite of the global push for renewable energy.

Komolafe noted, “the successful bidders would help to increase Nigeria’s oil production output while ensuring that the country retains its position as one of the leading oil producers in Africa.”

According to him, this will also boost government revenues, which are crucial for national development.

“The future of the Nigerian oil and gas industry must be both prosperous and sustainable.

“We are committed to ensuring that operators align with the country’s environmental policies while also contributing to economic growth,” he said.

Industry experts have also lauded the development, pointing out that the bid round offers an opportunity for the country to reverse the decline in its crude oil output.

This is a consistent fall in recent years due to ageing fields and a lack of fresh investments.

Mr Mike Osatuyi, former Operational Controller, Independent Petroleum Marketers Association of Nigeria (IPMAN), said that the awarding of the 25 oil blocks would create thousands of direct and indirect jobs across the country.

“The new exploration activities will require skilled labour, technical expertise, and support services, all of which will positively impact Nigeria’s economy, especially in regions where the blocks are located.

“In addition, the government anticipates increased revenue generation through taxes, royalties, and dividends from the exploration and production activities of the awarded companies.

“The revenue is expected to be reinvested in critical infrastructure, education, and healthcare, contributing to long-term socio-economic development,” Osatuyi stated.

Similarly, Mr Rabiu Bello, an oil and gas expert, said that if the winners were industry players with technical and financial capabilities to explore and develop the assets in the shortest possible time, then Nigeria would benefit from increased production and foreign exchange revenues

According to him, these are needed to stabilise the currency and service foreign debt.

On his part, Alhaji Debo Ahmed, former President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), noted that production had been below capacity.

“Nigeria’s oil production has been hovering around 1.3 million barrels per day (bpd), well below its potential capacity,” he said.

Ahmed stressed the importance of attracting both local and foreign investments.

He noted that a mix of indigenous and foreign firms could bring the needed capital, technology and technical expertise required for oil exploration and production.

Mr Williams Akporeha, President of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG). advised that the government must not only award oil blocs but also ensure that the winning companies immediately commence development and exploration activities

He emphasised that this approach is crucial for effectively deepening growth within the oil and gas industry.

Meanwhile, local companies have also hailed the bid round as a sign of growing opportunities in the oil and gas sector.

They said that the development would allow them to demonstrate their capacity in the exploration and production of the nation’s rich oil resources.