Tag: NUPRC

Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, said Nigeria is applying lessons from costly global divestment cases to safeguard its oil and gas sector, securing over $400 million in decommissioning liabilities and setting stricter rules for asset transfers.

Komolafe made the disclosure yesterday during his remarks at the Nigerian Extractive Industries Transparency Initiative (NEITI) Companies Forum, held in Lagos.

Represented by the Deputy Director, Human Resources, Corporate Services & Administration, Efemona Bassey, the NUPRC chief executive spoke on the theme: “Divestments, Liabilities, and the Impact of Ongoing Reforms on Extractive Companies in Nigeria.”

This was contained in the press statement the commission’ Head, Media and Strategic Communications, Mr. Eniola Akinkuotu yesterday.

According to the statement, the NUPRC boss said the Commission had drawn lessons of divestments from lessons of the North Sea, where decommissioning is estimated at £27billion by 2032, the Gulf of Mexico costing over $9billion and in Canada’s Alberta, more than 97,000 inactive or abandoned wells now carry an estimated decommissioning and abandonment cost of between C$30 and C$70billion.

Read Also: Police arrest self-proclaimed “Obi of Lagos,” foil installation ceremony

In Australia, Northern Oil & Gas Australia in 2019 left behind liabilities of more than AU$200million.

The CCE stated that the lessons from these experiences guided the recent divestment approvals from NAOC to Oando Energy Resources; Equinor to Chappal Energies; Mobil Producing Nigeria Unlimited to Seplat Energies; SPDC to Renaissance Africa Energy; and TotalEnergies to Telema Energies.

The CCE said: “Without a robust and enforceable framework for abandonment and decommissioning, divestment transitions can create lasting financial and environmental burdens.

“Nigeria is not immune to this challenge, and if we are to avert costly mistakes. It is precisely to avoid this outcome that Nigeria, through the Petroleum Industry Act and subsequent regulatory actions, has taken bold and decisive steps.”

The NUPRC boss highlighted Nigeria’s response to the recent divestments in line with Sections 232 and 233 of the PIA which place full responsibility for the decommissioning and abandonment of petroleum wells, installations, structures, utilities, plants, and pipelines on licensees and lessees.

Similarly, Chapter 3 of the PIA and Section 104 of the PIA, establish specific obligations for host community development and environmental remediation respectively.

He said each of the 2024 divestments provided a critical opportunity to put the Commission’s Divestment Framework to test and action: rigorously assessing the technical capacity of acquiring entities, verifying their financial strength, and securing decommissioning and abandonment obligations through upfront escrow arrangements.

Komolafe said: “The results from 2024 speak for themselves. Over $400 million in pre-sale decommissioning and abandonment liabilities have been secured through Letters of Credit and escrow accounts.

“Host Community Development Trust obligations are fully honoured. Environmental remediation commitments worth over $9.2 million have been pledged while awaiting the formal gazetting of the ERF Regulations.”

The CCE said beyond the significant progress achieved through our Divestment Framework, it is important to highlight another milestone.

“Since April 2023, we have approved 94 Decommissioning and Abandonment (D&A) plans, in strict alignment with the PIA. These approvals represent total liabilities of $4.424 billion, arising from all Field Development Plans submitted within this period, and will be remitted progressively over the production life of the respective fields into designated escrow accounts,” he added.

He further disclosed that the Commission has addressed a long-standing concern with the IOCs regarding the domiciliation of the escrow accounts; and the regulatory framework, developed after extensive consultations with industry stakeholders, is now awaiting gazetting by the Ministry of Justice.

He acknowledged the invaluable role of NUPRC partners, NEITI and Oil Producers Trade Section (OPTS).

According to him, as the moral compass of the extractive industry, NEITI has consistently ensured that NUPRC embedded transparency and disclosure in all its regulatory processes while OPTS, the united voice of producers, has supported us in shaping regulations that balance industry realities with national priorities.

“In addition to divestments, the Commission has been working together with operators, particularly members of OPTS, on life extension projects, ranging from facility integrity audits to subsea upgrades and enhanced reservoir management measures that sustain safe production, delay decommissioning, reduce environmental risks, and secure resilience across our mature fields,” he said.

The Nigerian Commission Chief Executive (CCE) Nigerian Upstream Petroleum Regulatory Commission (NUPRC) yesterday held the closing ceremony for the Execution of the Production Sharing Contract (PSC) with Nigerian National Petroleum Company (NNPC) Limited and the TotalEnergies–Sapetro Consortium, urging the partners to instantly carry out exploration leading to Final Investment Decisions ((FIDs) for the two offshore blocks.

The Commission Chief Executive Officer, Gbenga Komolafe, an engineer, said the Commission also expects swift and technically sound exploration, leading to early FIDs. He also urged the consortium to deepen local content, create quality jobs, empower Nigerian businesses, develop  and produce that is expected to raise crude oil output to about three million barrel per day target. The PSC covered the  Petroleum Prospecting Licences 2000 and 2001  awarded to TotalEnergies and its partner South Atlantic Petroleum (Sapetro) in the 2024 Licensing Round.

Komolafe commended President Bola Tinubu for supporting the implementation of the Petroleum Industry Act (PIA) with the political much needed political will, insisting unexplored assets must be revoked.

He said: “Let me begin by paying glowing tributes to His Excellency, President Bola Tinubu for the bold initiatives and reforms in the industry as well as his steer that undeveloped assets must return to the basket for rebidding and award to competent bidders in line with provisions of the PIA.”

Read Also: Tinubu pledges speedy implementation of Nigeria–Colombia agreements

Komolafe said TotalEnergies has 60 years operations in Nigeria and holding 80 per cent contractor interest, as well as Sapetro with 30 years operations and holding 20 per cent contractor interest.

He recalled that the Licensing Round was based on a fair, transparent and competitive bidding process in line with Section 73 of the PIA.

According to him, the award of these two offshore blocks, spanning about 2,000 square kilometres in the prolific Niger Delta Basin, is a direct product of the transparent, competitive, and reform-driven framework introduced.

On the 3mb/d output, the NNPCL Chief Executive Officer (GCEO), Bashir Ojulari also said, “The PSC is a major milestone that speaks to the regulator’s commitment to implementing the provision of the PIA and will no doubt bring NNPC Limited closer to achieving the target of 3 million barrels per day and an additional investment of 60 million dollars by 2030.”

Ojulari said the PSC has robust fiscal terms, listing them as “One, a signature bonus of $10 million, production bonus of 2 million barrels and 4 million or cash equivalent on attainment of 35 million barrels and 100 million barrels production risk.”

• 2.5mb/d 2026 target on track

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has completed a case-by-case review of the marginal fields licensing that are due for renewal. The exercise is a show of transparency and commitment to the development of the country’s hydrocarbon resources,

The Commission Chief Executive, Gbenga Komolafe, an engineer, made the disclosure in Abuja during his address at the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) Energy and Labour Summit (PEALS) 2025.

The theme of the summit was: ‘Building a Resilient Oil and Gas Sector in Nigeria: Advancing HSE, ESG, Investment, and Incremental Production.’

Komolafe also listed an array of ongoing activities that will culminate in the increase of crude oil production to 2.5million per day in 2026. He noted these to include the reactivation of dormant fields which have already raised daily output to 1.8mb from 1.46mb in October last year.

“ Coupled with reactivating dormant fields, accelerating approvals, and deploying improved recovery techniques, these efforts have already increased production from 1.46 million barrels per day baseline in October 2024 to 1.8 million barrels today. With this momentum, we are firmly on track to reach our 2.5 million barrels per day target by 2026,” the Commission chief said.

Although he said the 2020 marginal field round was concluded before the NUPRC took off, however, he added that every award is done in a manner that awardees are meant to meet specific terms of the Act.

The Commission boss clarified that based on the provisions of the law, the marginal field holders are expected to meet specific milestones upon which they will be assessed and considered for renewal. He explained that a technical assessment was done by the Commission on the marginal fields on a case-by-case basis in line with the extant laws, adding that license renewal will be merit-based.

Komolafe said, “It doesn’t necessarily mean that they should meet the terms of the award at the same time. The Act has made it clear that the terms are organised in such a way that it is on a milestone basis. In that respect, for the marginal fields that are due for renewal, and in the transparent manner the NUPRC has operated, we try to look at each marginal field on a case-by-case basis.

“We defined the technical assessment criteria and made it available to all the marginal fields and requested them to cooperate. An expert team was set up that reviewed each of the awardees on a case-by-case basis and recorded it on a score sheet that was equally done transparently.”

Komolafe disclosed that the outcome of the assessment has been submitted to the Minister of Petroleum State Petroleum (Oil) for approval in line with the provisions of the Petroleum Industry Act.

“On the basis of that, we have submitted the results of the assessment to the Minister for approval. So, we believe that in the weeks ahead, successful companies that have met the required milestones will have their marginal fields renewed,” he stated.

He noted that the 2024 licensing round was a landmark exercise conducted with full transparency, praised by NEITI, broadcast live at the commercial stage, and widely commended as the first in which no one could claim a single dime was paid to anyone.

Read Also: FG tagets N24bn annual savings from BisonFly initiative

The NUPRC boss said, “The last licensing round that was conducted, which ended in 2024 is a licensing round that, as a country, we should be very proud of. That exercise, we got recommendations from NEITI. At that exercise, I made it clear as the regulator of the industry that, for once, we are going to make sure that the exercise conforms with all tenets of transparency.”

He added, “No one paid a penny outside the normal official data prying fees and drastically reduced signature bonus by Mr President as the Honourable minister in vacation of entry barriers for facilitation of investments in the industry.”

He said the Commission’s ambition is to be resource-responsible by harnessing hydrocarbons with world-class efficiency and environmental stewardship, while strategically investing in cleaner alternatives.

He said the NUPRC, guided by the transformative Petroleum Industry Act (PIA) 2021, has established a modern legal, governance, and fiscal framework that addresses long-standing investor concerns.

In the area of incremental production, the NUPRC boss said the commission has been able to spearhead strategic initiatives that directly support the Project One Million Barrels per Day incremental production target through proactive industry collaboration.

According to him, industry players are forging a common agenda for unlocking more than 810,000 barrels of oil per day, in potential peak output, from approved deep offshore development plans.

Komolafe said in the area of incremental production, the NUPRC, through proactive industry collaboration, has been spearheading strategic initiatives that directly support the Project One Million Barrels per Day incremental production target.

He said a good example is the recent Deepwater Technical Stakeholders’ Workshop for unlocking the production potentials of the deepwater resources in Nigeria.

He recalled that the high-level forum brought together leading operators, service companies, and policymakers to forge a common agenda for unlocking more than 810,000 barrels of oil per day, in potential peak output, from approved deep offshore development plans.

At the heart of the effort, according to him, is the cluster and nodal development strategy, designed to maximise shared infrastructure, capture economies of scale, and enable coordinated tiebacks to existing FPSOs like Bonga, Egina, and Agbami.

He said the approach significantly reduces project costs, shortens timelines and de-risks investments.

Komolafe said the collaborative model mirrors global success stories from regions like the North Sea, where cluster strategies revitalized mature basins and sustained competitiveness for decades. He said it also positions Nigeria’s deepwater as a competitive, investor-friendly frontier capable of delivering substantial incremental barrels within the next few years.

The summit with the: “Building a Resilient Oil and Gas Sector in Nigeria: Advancing HSE, ESG, Investment, and Incremental Production,” according to him, has become more than just an annual fixture.

He said it has evolved into a trusted marketplace of ideas, where frank dialogue meets forward-thinking engagement, and where collaborative problem-solving charts a path for an industry that directly contributes so much to Nigerian economy.

On sustainability and ESG drive, he said NUPRC is taking decisive steps to future-proof the industry.

The Chief Executive explained that NUPRC Upstream Decarbonisation Framework and gas-centric transition strategy aim to eliminate routine flaring by 2030, cut methane emissions by 60 per cent by 2031, and monetise the country’s vast gas resources.

He added that through initiatives like the Decade of Gas, the Nigerian Gas Flare Commercialisation Programme (NGFCP), and the Presidential CNG Initiative, NUPRC is creating thousands of green jobs and positioning Nigeria as Africa’s gas powerhouse.

Komolafe said the theme is as timely as it is strategic.

Continuing, he stressed “We stand today at a defining moment in both our national and global energy story: a time when the forces of transition, technology, and geopolitics are redefining the future of oil and gas. Indeed, energy transition is gathering pace around the world. Global investment in low-carbon energy not only exceeded $1.7 trillion in 2023, surpassing fossil fuel investment for the first time in history, according to the International Energy Agency (IEA), but also surged by an additional 24 per cent in 2024, reaching an unprecedented $2.1 trillion, as reported by BloombergNEF.

“Yet, if history and experience are any guide, the nations that will lead this transition are those that strike the right balance between sustaining current energy security and preparing for the low-carbon economy of tomorrow. While hydrocarbons are still expected to account for more than half of the world’s primary energy needs by mid-century, the International Energy Agency projects that renewables will supply nearly 90 per cent of new global electricity generation by 2030.

“Both OPEC and the U.S. Energy Information Administration underscore that fossil fuels will remain indispensable in meeting the energy demands of expanding populations and fast-growing economies, particularly in Asia and Africa.

“For Nigeria, the implications are profound. With proven reserves of 37.28 billion barrels of crude oil and 210.54 trillion cubic feet of natural gas, our upstream sector remains the backbone of the economy, delivering about 90 per cent of export earnings and nearly 70 per cent of government revenue.

“But our ambition must go beyond being resource-rich; we must be resource-responsible, harnessing hydrocarbons with world-class efficiency and environmental stewardship, while strategically investing in cleaner alternatives.

“The urgency of this task is magnified by rising global scrutiny, climate vulnerability, supply chain disruptions, and local challenges such as underinvestment and infrastructure gaps.”

Speaking earlier, the President of PENGASSAN, Festus Osifo, commended the CCE for his commitment to drive transparency and accountability in the upstream sector.

He acknowledged the Commission’s innovations, noting that its consistent commitment to reforms has strengthened the upstream oil and gas sector.

Osifo said, “As the regulator of the upstream oil and gas sector, your industry is as strong and firm because you have proven over the years that you are committed to driving your mandate and decision to reform the industry.”

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has raised the alarm over looming manpower shortages, which threatens the sustainability and competitiveness of the country’s energy sector.

NUPRC warned that without urgent investment in developing the next-generation of energy professionals, Nigeria’s long-term energy security could be compromised.

Commission Chief Executive (CCE), Engr. Gbenga Komolafe, gave the warning at the 48th Nigeria Annual International Conference and Exhibition (NAICE 2025), organised by the Society of Petroleum Engineers (SPE) in Lagos.

Komolafe challenged professional bodies and industry stakeholders, including the SPE, to confront the widening talent gap in the oil and gas sector.

He described human capital as “the most valuable asset of our industry,” stressing that the future of Nigeria’s upstream sector hinges on targeted capacity-building, especially among young professionals.

Speaking on the conference theme, “Building a Sustainable Energy Future: Leveraging Technology, Supply Chain, Human Resources and Policy,” Komolafe said the sector is at a crossroads, caught between the pressures of energy transition, dwindling investment, and the urgent need to ramp up domestic production.

“The convergence of technology, skilled manpower, and supportive policy is no longer optional—it is imperative for survival,” he said, insisting that “Without the right talent pipeline, we risk falling behind in an increasingly de-carbonised and competitive global energy market.”

Read Also: Federal Govt: security under control

He warned that without proactive workforce development, Nigeria’s oil and gas industry could struggle to adopt innovations necessary for cleaner, more efficient operations.

Komolafe, however, said to address this, the NUPRC has been working with academic institutions and training bodies to bridge the skills gap and align local competencies with global standards.

He also highlighted several Commission-led initiatives focused on embedding de-carbonisation in field development and production processes, noting that energy security must now be pursued alongside environmental responsibility and economic sustainability.

“As the industry regulator, we are not just focused on compliance—we are enabling an upstream ecosystem that is stable, efficient, and future-ready,” he said.

Komolafe said central to this effort is technology, noting that NUPRC has embraced digital transformation across its regulatory operations, aiming to improve service delivery, transparency, and cost-efficiency.

It is also promoting the use of advanced technologies in exploration and production, particularly in emission reduction and resource optimisation.

He further pointed to supply chain resilience as a strategic lever in building energy security. “We’ve created a regulatory environment that supports the growth of both indigenous and international service companies,” Komolafe said.

He added that efforts are underway to boost local manufacturing, encourage technology domestication, and reduce dependence on foreign inputs.