DPR Awards 57 Marginal Oilfields, to More Indigenous investors in the Oil and gas Sector

In a strategic engagement session with the Nigeria Extractive Industry Transparency Initiative (NEITI) in Lagos on Wednesday, the 26^th of May, 2021, the Department of Petroleum Resources (DPR) Director, Sarki Auwalu disclosed that about 57 companies have been awarded licenses to commence production from January 2022, from the smaller oil blocks otherwise called the marginal oil fields developed by indigenous companies. According to the DPR Director, the marginal oilfield bid round was almost at the completion stage, and that successful companies had started paying their signature bonuses. He added that between January and March, the agency generated about N452 billion for the Federal Government, while an additional estimated N900 billion is expected in the second quarter of the year.

The DPR had earlier released the results of the marginal oil fields bidding. 630 applicants were received, out of which 500 scaled through prequalification, while only 161 were shortlisted for the final stage. The release also noted that the DPR reserves the discretion to give interest in the available fields to the 161 companies. All the fields will be operated using Special Purpose Vehicles (SPVs), and the DPR has notified the 161 companies of the fields assigned to them without the names of their partners and equity interest in those fields.

Stakeholders have complained that the bid process is not transparent. The DPR compounded their fears by not publishing the list of the winners and all relevant information on its website in accordance with leading practices. This is another room for the agitation to pass the PIB into law. Nevertheless, a successful completion of this process will deepen the participation of indigenous companies in the upstream segment of the industry, and increase Nigeria’s oil and gas production capacity while also boosting the revenue for national development.