The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) will begin recovering oil blocks from licence holders who have failed to meet stipulated development timelines, as it moves to enforce the “drill-or-drop” policy.
The commission’s Chief Executive, Oritsemeyiwa Eyesan, disclosed this on Tuesday at a two-day onboarding workshop in Lagos for holders of Petroleum Prospecting Licences awarded during the 2022/2023 and 2024 licensing rounds.
Eyesan said the commission had issued a directive to reclaim assets from operators who had failed to undertake activities within the approved periods of three years for onshore blocks and five years for offshore blocks.
She dismissed suggestions that the directive was an empty threat, insisting that operators could not retain undeveloped assets indefinitely.
According to Eyesan, some licence holders disbanded the technical teams they assembled to secure the assets, leaving them without the expertise required to develop the blocks. Others struggled to secure financing or technical partners before seeking extensions.
She warned that these difficulties would not automatically justify additional time, stressing that licence extensions were not guaranteed.
The commission’s enforcement measures could include refusing extensions, requiring acreage relinquishment, calling in work performance securities and initiating revocation proceedings.
Eyesan urged new licence holders to ensure they had the technical expertise, financing and management structures needed to develop their assets.
She said the commission’s review of previous licensing rounds and divestments by international oil companies showed mixed results. While some operators increased production from previously undeveloped fields, others recorded significant declines after acquiring producing assets.
The NUPRC has also challenged 22 new licence holders to accelerate development. According to reports from the workshop, the companies are expected to achieve first oil within 18 months, while the broader production target for the new awardees is about 250,000 barrels per day within five years.