Financial Energy Review
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has begun the technical screening of financially qualified bidders for the 2024 oil licensing rounds. This process is crucial in determining each company’s technical capacity to operate the oil blocks for which they submitted bids, with 31 oil blocks on offer—comprising 26 deep offshore blocks, three continental shelf blocks, and two onshore blocks.
According to the NUPRC, 29 of these blocks are located in the Niger Delta, while two are in the Bida Basin. The bid rounds, which kicked off in May, entered the Registration and Pre-qualification stage, which concluded on July 5. The initial pre-qualification evaluation was based on bidders’ financial and technical capabilities, compliance with legal standards, and health, safety, and environmental policies. Companies meeting these criteria were notified of their successful pre-qualification.
The licensing bid process has now progressed to the Technical and Commercial Bid phase, during which participants will gain data access and evaluate options. The submission deadline for technical and commercial bids is November 29, 2024, with technical evaluations and notifications of qualified companies slated for December 9, 2024.
Only companies that pass the technical evaluation will advance to the Commercial Bid Conference, where the final bids will be reviewed. As part of the licensing conditions, selected companies must provide performance security equivalent to 2.5% of their work commitment upon licensing.
The NUPRC emphasized its goal of revitalizing Nigeria’s oil industry to attract local and international investment, with Nigeria’s hydrocarbon resources estimated at 37.5 billion barrels of crude oil and condensate reserves and 209.26 trillion cubic feet of natural gas reserves.
Initially, 19 blocks were offered in 2024, but strong demand led to an increase to 36 blocks. Legal disputes, however, removed five blocks from the round. Each block is equipped with advanced data and technology, meeting high global standards to appeal to investors.
The licensing process highlights the NUPRC’s drive to optimize Nigeria’s natural resources and modernize the oil and gas sector through the strategic attraction of investors.
