The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has given operators holding undeveloped oil and gas assets until October 31 to demonstrate compliance with their licence obligations, warning that failure to respond could trigger regulatory action, including licence revocation.
The Commission Chief Executive, Oritsemeyiwa Eyesan, said the regulator would enforce the drill-or-drop provisions of the Petroleum Industry Act (PIA) against companies that retain acreages without executing approved work programmes. She spoke at an energy conference organised by the Harvard Business School Association of Nigeria in Lagos.
“Now the PIA has instituted the drill-or-drop mechanism. So, before you take the block, you know whether it’s a gas asset, you know whether it’s an oil and gas asset, and you must come up with concrete plans to unlock your resources,” Eyesan said.
In a circular dated September 14, 2026, the commission directed holders of licences awarded under the 2020 marginal bid round, the 2022/2023 mini bid round and the 2024 licensing round to submit their compliance status by October 31. The affected operators must disclose the level of execution of their approved work programmes, identify constraints delaying activities and propose corrective measures, including revised implementation timelines.
Eyesan warned that operators holding onshore assets must undertake the required work within the stipulated three-year initial period. “For those onshore, you have three years. Within three years in the first instance, if you do nothing about those assets, we will call it up,” she said.
The commission cited Sections 77, 78 and 88 of the PIA, alongside the default and revocation provisions in Sections 96 and 97, as the legal basis for enforcing licence commitments. Possible sanctions include refusing licence extensions, requiring acreage relinquishment, calling in work performance securities and commencing revocation proceedings.
The regulator also acknowledged that some operators face genuine operational and commercial constraints, including financing difficulties, rig availability, insecurity, host community issues, infrastructure gaps, delays in regulatory approvals and disputes among partners. Such companies must disclose the specific obstacles and proposed remedies by the deadline, but engagement with the commission will not automatically extend licence terms or exempt them from statutory obligations.
In the circular, the NUPRC stated that a petroleum prospecting licence carries obligations under the licence instruments, General Licence Conditions, Concession Contract, Minimum Work Programme and Work Performance Security. It stressed that operators must meet these commitments within the licence term to retain their acreages.
“Acreage is held to be worked, and acreage that is not worked within its term returns to the Federal Government,” the circular stated.
The commission said its priority was to increase production by ensuring that licensed assets are developed, rather than to revoke licences indiscriminately. However, it warned that disagreements among partners would not be accepted as justification for failing to meet licence conditions.
The October 31 deadline therefore places affected licence holders under pressure to account for work completed, explain outstanding commitments and demonstrate how they intend to bring delayed projects back on track. Operators were directed to channel enquiries through the Executive Commissioner for Exploration and Acreage Management, Bashari Indabawa.