Nigeria is lowering production contract costs for oil companies seeking to re-enter the oil and gas industry.
Nigeria plans to replace signature bonuses owed by companies to the government with lump sums for production, according to Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Chief Executive Gbenga Komolafe.
He says Nigeria’s oil and gas industry is set to undergo a paradigm shift, aiming to lower costs and address licensing delays.
Companies bidding in the next licensing round, which is expected shortly, will “see that Nigeria is ready to do business differently,” the CEO of the upstream regulator added.
Nigeria faces challenges in oil and gas production, consistently failing to meet OPEC+ quota due to pipeline vandalism, oil theft, and insufficient capacity investment.
President Bola Tinubu has pledged to increase oil and gas production and make the sector more attractive to international oil companies since taking office in May 2023.
The Nigerian presidency announced that Shell has identified $6 billion worth of oil and gas investment opportunities in the country.
Shell’s Integrated Gas and Upstream Director Zoë Yujnovich and Shell Nigeria PLC executives met with Nigerian President Tinubu in Abuja in early December.
According to presidential spokesperson Ajuri Ngelale, Shell has identified a $5 billion investment opportunity in Nigeria’s offshore oil exploration and production, and plans to invest an additional $1 billion within 10 years to boost natural gas production.