2025 Licensing: NUPRC Limits Bidders to Two Oil Blocks, Emphasises Technical, Financial Capacity

Strict participation guidelines for the 2025 licensing round were announced yesterday by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC). These guidelines restrict each bidder to a maximum of two oil and gas blocks and shift the emphasis from speculative acquisitions to operators with demonstrated financial stability and technical depth.

The regulator which stated these at the 2025 licensing round pre-bid webinar said the new framework is designed to deepen development outcomes, accelerate production and align Nigeria’s upstream sector with global best practice.

According to the commission’s standards, bidders who can clearly show that they have the technical know-how to run the assets and the financial means to finance exploration and development activities up to the first oil or gas will be given precedence.

The NUPRC claims that the days of storing assets lacking clear funding plans or work programs are past and that block allocation will henceforth be determined by the ability to add value to the economy and industry rather than just by aggressive bidding.

Oritsemeyiwa Eyesan, the Chief Executive of the Commission, stated at the virtual event that only candidates with solid technical and financial credentials will advance to the crucial phase of the bidding process for the 50 blocks.

Pre-qualification and registration, data collection, technical bid submission, evaluation, and a commercial bid conference are the five stages of the procedure. Only applicants with solid financial and technical credentials, professionalism, and believable ideas advance. “A transparent, merit-based process is used to select winners,” she reaffirmed.

Signature bonuses for the 2025 licensing round are now set within a value range that lowers entry barriers and gives more weight to what really matters: technical capability, credible work programs, financial strength, and the ability to deliver production in the shortest amount of time, according to the NUPRC chief executive, with President Bola Tinubu’s approval.

Additionally, the commission established strict financial requirements for winning bids, including that signature bonuses be paid within 60 days of the offer letter’s delivery; otherwise, the award would expire. It further stated that in an attempt to strike a compromise between the costs of investor entry and the requirement to get significant commitments, one-time payments for the blocks have been set between $3 million and $7 million, depending on asset categorization.

The NUPRC CEO said, “This has been done to increase competitiveness and in response to capital mobility.”

According to Eyesan, the licensing round is an open appeal for dedicated partners who are prepared to make financial investments, contribute technical expertise, and expedite Nigeria’s assets from license award to exploration, appraisal, and eventually full production.

Nigeria is “ready to be the beautiful bride to capital and playroom for advanced technological deployment for hydrocarbon recovery,” she said, reiterating the commission’s commitment to an open licensing round.

“50 oil and gas blocks across Nigeria are available in this licensing round, allowing investors to access the country’s key basins and create long-term value,” she continued.

Additionally, Eyesan gave the public assurances that the bid process would adhere to the Petroleum Industry Act (PIA), encourage the use of digital tools for efficient data access, and be subject to institutional and public scrutiny via the Nigeria Extractive Industries Transparency Initiative (NEITI) and other oversight organizations.

“Let me stress that there is more to the Nigeria 2025 license round than just a bidding process. The head of NUPRC stated, “It is a clear indication of a reimagined upstream sector, anchored in the rule of law, driven by data, aligned with global investment realities, and focused on long-term value creation.”

In order to assist investors in navigating uncertainty and operating within a framework that is transparent, predictable, and purposefully created to inspire confidence, NUPRC subject matter experts presented the guidelines, model contracts, bid parameters, and evaluation criteria during the webinar.

During his presentation, Mr. Augustine Okwah, Head of the NUPRC’s Alternative Dispute Resolution Center (ADRC), mentioned that every bidder who receives an offer is required by the guidelines to pay within sixty days.

Additionally, he clarified that the commission will only examine bids for a maximum of two oil and gas blocks.

“The offer letter will outline the prerequisites that the successful bidder must meet before the minister issues the license. The signing bonus must be paid within 60 days of the offer letter’s issuance as part of the condition precedent. Your job commitment guarantee will be part of it.

After that, you have to provide a performance bond to ensure that you fulfill your employment duty. Naturally, you must also provide proof that you have paid your rent for the first year. The commission will then invite the reserve bidder to meet these requirements if the winning bidder is unable to do so within these 90 days, at which point the offer made to the winning bidder will expire without recourse to the winning bidder, he said.

Importantly, he clarified that if a successful bidder runs under a concessional contract arrangement, the government will have the authority to seize up to 60% of the asset at any point during its lifetime, with the NNPC acting on the government’s behalf.

“The general license condition refers to the general terms and conditions of the license that you must follow while the license is pending, and naturally, the bid is for a maximum of two blocks.” “Those extra submissions won’t be considered if you bid for any blocks beyond these two blocks,” he clarified.

He claims that any successful bidder who doesn’t fulfill his commitments will have their bids withdrawn in accordance with the PIA, and the other non-defaulting members would split the cancelled participation interest.

Additionally, Dr. Amba Ndoma-Egba, Deputy Director, Lease Administration, Exploration and Acreage Management, stated in his submission that the bid round’s goals include guaranteeing energy sufficiency, increasing gas utilization, expanding opportunities, and drawing in international investment.

“In addition to the mature Niger Delta Basin, we have the Sokoto Basin, the Chad Basin, the Benue Trough, the Bida Basin, the Anambra Basin, and the Benin Basin. Five of the seven basins will participate in this licensing round, he said.

He reaffirmed that the signature bonus will be between $3 and $7 million, emphasizing that the commission has the authority to decide how much of the bond will be awarded in relation to the work program commitment.

“The signature bonus is within a range,” the CCE stated in her remarks. Version 16 of the Petroleum Industry Act 2021 will be used to evaluate our range, which is between $3 million and $7 million. He said, “The Commission has the authority to decide what portion of the bond will be awarded in relation to the work program commitment.