The Nigerian National Petroleum Company (NNPC) Ltd, in partnership with the TotalEnergies–Sapetro Consortium, has executed a Production Sharing Contract (PSC) for Petroleum Prospecting Licences (PPLs) 2000 and 2001, marking a significant milestone in Nigeria’s upstream oil and gas sector. This is the first PSC to comprehensively cover both crude oil and natural gas exploration and production.

The signing ceremony, held on Monday at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) headquarters in Abuja, represents a major step in the Federal Government’s efforts to harness Nigeria’s vast hydrocarbon resources responsibly and profitably.

Group Chief Executive Officer (GCEO) of NNPC Ltd, Engineer Bayo Ojulari, described the deal as historic, noting its high-impact prospects for enhancing energy security and driving Nigeria’s economic growth.

“This particular PSC is unique in many respects. It is the first PSC that comprehensively covers both crude oil and natural gas. It is also the first with robust gas terms, including a profit gas split that incentivizes monetisation of non-associated gas,” he stated.

Ojulari stressed that the ceremony was not merely a contract signing but a powerful testament to the success of the Petroleum Industry Act (PIA) 2021. He added that it sends a clear signal to the global investment community that Nigeria is open for business.

He reaffirmed NNPC Ltd’s commitment to leveraging such partnerships and expertise to deepen upstream operations, surpass previous deepwater achievements, and apply cutting-edge technology and high operational standards to ensure commercial viability and sustainability.

Commission Chief Executive (CCE) of NUPRC, Engineer Gbenga Komolafe, explained that the award of the two offshore blocks, covering about 2,000 square kilometres, was the result of a transparent, competitive, and reform-driven framework introduced under the PIA 2021.

Komolafe commended NNPC Ltd and the contractors—TotalEnergies (holding 80% interest) and Sapetro (holding 20% interest)—for their commitment to exploration and production in Nigeria, referencing their success in projects such as Egina and Akpo.

Managing Director/Chief Executive Officer of TotalEnergies E&P Nigeria Limited, Matthieu Bouyer, said the signing reaffirms the company’s long-standing commitment to Nigeria, where it has operated for over 60 years. He noted that the blocks, awarded through an open and transparent bid process, mark the first time in over a decade that an international oil company (IOC) has secured deepwater assets in Nigeria.

Managing Director of South Atlantic Petroleum Limited (Sapetro), Chukwuemeke Anagbogu, also expressed delight in the partnership, describing the agreement as a reaffirmation of Sapetro’s alignment with the government’s vision for responsible resource utilisation, local content advancement, and inclusive economic growth.

He added that the blocks provide a clear path to increasing reserves and sustaining long-term production growth, thereby creating lasting value for shareholders, stakeholders, and the nation.

The PSC includes provisions for signature and production bonuses, a defined minimum work programme with performance guarantees, cost recovery and profit-sharing rules, royalties and taxes, gas utilisation to reduce flaring, and obligations for decommissioning, environmental remediation, and host community development—all in line with the PIA.

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