FG Hands Over 57 Oil Fields to Local Investors

Unveils Guidelines for HOSCOM Fund

*Matrix, Ardova, Others Bebefit

*It’s A Great Day for Local Players-Awardees

The Federal Government has handed over some 57 oil fields located in Niger Delta’s onshore and swamps to local oil companies, prompting jubilation among awardees.
The handover, which was done in Abuja on Wednesday came with a charge to the beneficiaries to develop the oil fields and produce oil from them within six years.

Matrix Energy, Suntrust Oil, Energia Ltd, Mainland Oil and Ardova Oil, formerly known as Forte Oil, are among the 100 beneficiaries awarded Petroleum Prospecting Licence, PPL, out of which 57 are local companies. Forty one of the 57 local fields have been fully paid for.

The development is an attempt by the federal government to ramp up the country’s oil production capacity from its current significant 1.2mbd, a far cry from its daily production benchmark of 1.88mbd and OPEC’s quota of 1.77mbd.

While speaking at a ceremony, the Minister of State Petroleum Resources,  Timipre Sylva, said the decision to award the oil fields to the indigenous companies was a deliberate government policy geared towards encouraging more indigenous participation in  petroleum operations. The PPLs were presented to the companies.

“Indeed, this will boost activities in the oil and gas sector, add to our production output and create additional employment opportunities,” Silva stated.

The minister explained that the Petroleum Industry Act, PIA, 2021 has abolished the marginal oil field policy making it possible for PPLs to be issue to new owners.

“As you are aware, the implementation of the PIA is in top gear. Consequently, the new awardees should note that their assets will be fully governed by the provisions of the PIA as a result each successful field will be issued a PPL in line with the PIA.

“This is a complete departure from what used to be there where the marginal field owners had no licences.

“This marks the beginning of a new era for us in the oil and gas sector and urges the awardees of the PPL to take advantage of the opportunities presented to exploit, develop and bring the assets to productive use,” he added.

The Minister, who also officially unveiled the Host Communities Development Regulations, urged the companies to conduct their operations in an environmentally friendly manner ensuring that they take adequate care of host communities.

Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission, NUPRC,  Gbenga Komolafe said the new 57 licenses bring to 87 the number of marginal fields so far awarded in the country.

“Historically, the marginal fields award initiative began in 1999 and was borne out of the need to entrench the indigenization policy of the Government in the Upstream sector of the oil and gas industry and build local content capacity.

“Besides, the initiative was also targeted at creating employment opportunities and encouraging increased capital inflow to the sector.

“Nigeria is known as an oil-producing country and it is best for us to take advantage of what the oil price is currently doing. We are very satisfied with the entire process since it started in 2020,” he added.

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