NUPRC moves against dormant oil licences

By Adewale Sanyaolu and Nnamani Adanna, Abuja

Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Oritsemeyiwa Eyesan, has declared that the era of oil companies holding on to prospecting licences without developing the assets is over.

Eyesan said the regulator is now strictly enforcing the “drill-or-drop” provision contained in the Petroleum Industry Act (PIA), compelling operators to either commence exploration activities or relinquish idle oil blocks.

She made this known while receiving a delegation from the Petroleum Directorate of Sierra Leone at the Commission’s headquarters in Abuja.

According to her, the enforcement of Section 94 of the PIA has fundamentally changed the landscape of Nigeria’s upstream sector by eliminating the long-standing practice where operators held licences for decades without developing the assets.

She explained that the new regime has begun to attract more serious investors into Nigeria’s upstream sector, particularly in the on-going 2025 licencing round, which is expected to boost the country’s petroleum reserves and unlock new exploration opportunities.

“The PIA has opened opportunities for both small and big players because there is now a drill-or-drop provision in the Act. In the past, we had operators who held licences for as long as 20 years and sat on those assets without doing anything. That era is now over,” Eyesan said.

She noted that the enforcement of the provision has expanded the pool of available assets and strengthened the Commission’s capacity to organise more frequent bid rounds, with the possibility of conducting annual licencing rounds going forward.

Eyesan also expressed satisfaction with the level of interest shown by investors in the 2025 licencing round, describing the number of applicants that participated in the pre-qualification stage as impressive.

She explained that the licensing round offers 50 oil blocks but the guidelines restrict each company, whether bidding independently or as part of a consortium, to a maximum of two blocks, a measure designed to encourage wider participation and promote fairness in the allocation process.

Earlier, the Director-General of the Petroleum Directorate of Sierra Leone, Foday Mansaray, said the delegation came to Nigeria to understudy the country’s petroleum regulatory framework and draw lessons that could help strengthen Sierra Leone’s hydrocarbon sector.