The Nigerian National Petroleum Company Limited (NNPC Ltd), in partnership with the TotalEnergies-South Atlantic Petroleum (Sapetro) Consortium, has executed a historic Production Sharing Contract (PSC) for Petroleum Prospecting Licences (PPLs) 2000 and 2001.
This marks the first of such agreement under the Petroleum Industry Act (PIA) 2021 to comprehensively cover both crude oil and natural gas exploration and production in Nigeria's deepwater offshore blocks.
The signing ceremony took place on Monday, September 1, 2025, at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) headquarters in Abuja.
The two blocks, spanning approximately 2,000 square kilometres in the prolific Niger Delta Basin, were awarded to the consortium during the 2024 Licensing Round through a transparent and competitive bidding process.
TotalEnergies holds an 80% contractor interest, while Sapetro, a Nigerian indigenous firm, holds 20%.Group Chief Executive Officer of NNPC Ltd, Engr. Bashir Bayo Ojulari, described the PSC as a "unique" milestone that addresses previous gaps in deepwater contracts, emphasizing its robust fiscal terms including a $10 million signature bonus, production bonuses tied to milestones (such as 2 million barrels upon reaching 35 million barrels and 4 million or cash equivalent upon 100 million barrels), and a 70% cost recovery limit.
Ojulari highlighted the contract's innovative gas provisions, including incentives for monetizing non-associated gas, which he said would enhance energy security, drive economic growth, and help Nigeria achieve its target of 3 million barrels per day by attracting up to $60 billion in investments by 2030.
He also commended the partners' track record in projects like Egina and Akpo.NUPRC Chief Executive, Engr. Gbenga Komolafe, praised the deal as a "new chapter" in Nigeria's upstream sector, crediting President Bola Tinubu's reforms, including Executive Orders 40, 41, and 42 on fiscal incentives, local content, and contract efficiency.
Komolafe noted that the PSC provides clarity on profit-sharing, royalties, taxes, gas utilization to reduce flaring, decommissioning, environmental remediation, and host community development obligations, all aligned with the PIA.
He urged the consortium to prioritize swift exploration, early Final Investment Decisions (FIDs), job creation, and sustainable practices to boost reserves and production.
Matthieu Bouyer, Managing Director/CEO of TotalEnergies E&P Nigeria Limited, reaffirmed the company's 60-year commitment to Nigeria, where it operates over 400,000 barrels of oil equivalent per day and employs more than 1,800 people.
Bouyer described the blocks as the first deepwater assets awarded to an international oil company (IOC) in over a decade, stating that TotalEnergies aims to spud its first well swiftly using low-cost, low-emission technologies to create value, reinforce local content, and support national goals.
Chukwuemeke Anagbogu, Managing Director of Sapetro, expressed delight in the partnership, noting its alignment with Nigeria's vision for responsible resource utilization and inclusive growth.
With Sapetro's 30 years of operations in the country, Anagbogu said the blocks offer a pathway to reserve growth, long-term production, and value creation for stakeholders and the nation.
This PSC, the first of seven deepwater blocks from the 2024 round to be executed, is expected to unlock untapped geological potential, potentially adding over 100 million barrels of crude to Nigeria's reserves while promoting decarbonization and economic prosperity
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