The NUPRC said Nigeria’s technical oil production potential stands at 2.26m bpd.
In a pre-emptive move to remove any potential misinterpretation, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has explained that the upcoming ‘closed’ bid round for the sale of oil and gas blocks this year was legal and in line with the provisions of the Petroleum Industry Act (PIA) 2021.
The commission also stated that Nigeria’s national technical oil production potential currently stood at 2.26 million barrels per day (bpd) well above the 1.5 million bpd production quota allocated to the country by the Organisation of Petroleum Exporting Countries (OPEC).
The Chief Executive Officer of the NUPRC, Mr. Gbenga Komolafe gave the clarifications on Tuesday, in Lagos, while speaking at two separate sessions at the ongoing 8th Sub-Saharan African International Petroleum Exhibition and Conference (SAIPEC).
Komolafe spoke at the same conference where the Secretary General of African Petroleum Producers Organisation (APPO), Dr. Umar Farouk announced that the country to serve as the headquarters of the upcoming African Energy Bank (AEB) would be made known before the next month.
The theme of this year’s SAIPEC was “The Next: Accelerating African Content.”
Although the NUPRC boss did not give the details of the closed bid round that would be coming up any time this year, he had announced last month that the commission would be conducting another Mini-bid Round for 12 offshore blocks.
Komolafe also said the earlier mini-bid round for the seven deep offshore blocks was nearing conclusion.
He maintained that further investment opportunities were also available in the licensing rounds, which would be conducted more frequently in line with the provisions of the PIA.
He explained, “At this point, let me use this opportunity to announce that the commission will be concluding the Nigerian ongoing seven deep offshore bid round which we commenced earlier.
“In addition to that, the commission will be conducting closed bid round in the course of the year. Let me take time to explain that the Petroleum Industry Act actually provided for both closed bid and open bid. Both are legal…because when we hear closed bid, it might be misinterpreted.
“So, closed bid is legal just as open bid is equally legal. Section 73 of the PIA makes this very clear. What is inherent in closed bid and open bid is that both will be conducted in a fair, transparent and very competitive manner. But the underlining thing is that both are legal by virtue of the provisions of the Petroleum Industry Act.”
He called on potential investors to take note of the bid round which the commission would be conducting in the course of the year in line with the provisions of the law.
According to him, that was part of the investment opportunities the commission would be showcasing at the event.
As part of the efforts to deepen Nigeria’s gas market and ensure decarbonisation of upstream operations, Komolafe mentioned that the commission recently awarded 49 flare sites to successful bidders for flare gas commercialisation through the Nigerian Flare Gas Commercialisation Programme (NGFCP).
Through the initiative, he said more gas would be available for domestic gas utilisation in the form of Liquefied Petroleum Gas (LPG), feedstock for power generation plants, fertilizer plants and petrochemicals as well as for exports.
However, stressing on the country’s oil production capacity, the NUPRC chief executive said Nigeria’s national technical oil production potential currently stood at 2. 26 million bpd as against the current 1.5 million bpd OPEC quota.
According to Komolafe, “The oil reserves and gas reserves in Nigeria respectively represents 30 per cent and 34 per cent of the African oil and gas reserves.
“Although the actual national production currently averages 1.33 million barrels of oil per day and 256 thousand barrels of condensate per day, the national technical production potential currently stands at 2.26 million bpd, and the current OPEC quota is 1.5 million bpd.
“Thus, the Commission is taking strategic measures to arrest some challenges confronting us in order to boost production and meet the potential.”
He said part of the measures being taken by the commission was to improve transparency in hydrocarbon measurement and accounting.
He stated that the commission engaged in collaborative work programme administration with the exploration and production companies and close monitoring to ensure that they meet their work programme obligations.
Aside from hydrocarbon resources, Komolafe said Nigeria was also blessed with potential for green and blue hydrogen, solar, wind, bio-mass and critical minerals for development of clean energy technologies as well as growing population predominated by young people.
In his address, the Secretary General of APPO, Farouk, disclosed that the organisation would by next month take a decision on which country to serve as the headquarters of the upcoming African Energy Bank (AEB).
He added that the bank would begin operation before the end of this year.
In December last year, the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, had said Nigeria was fighting hard to ensure that the headquarters of the proposed bank came to Nigeria since there was no continental headquarters of any agency in the country, apart from ECOWAS.
“The president himself is giving us all the support. We are making all the lobbying we need to do, so that at the end of the day, at least, the headquarters of the African Energy Bank comes to Nigeria, so that IPPG members may have closer access to the bank, and explore the opportunities of getting more funding from that bank”, the minister had stated.
However, the APPO secretary general, who stressed that Africa needed a new energy business model to survive the challenge of energy transition, also commended Nigeria for the investments it was making in the area of gas pipeline infrastructure such as the Trans-Saharan Gas Pipeline and the Nigeria-Morocco Gas Pipeline projects.
In his welcome remarks, Mr. Nicolas Odinuwe, the Chairman of the Petroleum Technology Association of Nigeria (PETAN), Mr. Nicolas Odinuwe, advised governments and institutions to desist from taking oil and gas industry stakeholders’ funds as part of their budgetary allocations.
Odinuwe said the funds were either surplus nor idle, describing the backbone of local content as community engagement and participation.
“Sustainable local content initiatives rely on active involvement from the local community to create, produce, and consume content that represents their interests and values.
“When the community takes ownership of the content creation process, it ensures authenticity, relevance, and a deeper connection to the environment.
“As the Chairman of PETAN, I am honoured to stand before you, representing an association that has been at the forefront of driving innovation and growth in the petroleum industry.
“Our commitment to excellence extends beyond oil and gas, as we recognise the transformative power of African content and its ability to shape narratives, inspire change, and drive economic growth,” he added.
