Operators of moribund oil blocks to forfeit licence – Lokpobiri
By Tunde Opalana
The Minister of State Petroleum Resources (Oil), Senator Heineken Lokpobiri has charged oil majors to sustain investment that will guarantee oil production growth while threatened that the federal Government will withdraw oil blocks from operators who have failed to energize such fields.
To meet up with production target of 2.06 million barrels per day in 2025, the minister said the government will begin implementing the “drill or drop” provisions of the Petroleum Industry Act in line with the drive to boost oil production.
As of February 2025, oil production was reported at 1.67 million barrels per day by the Nigerian Upstream Petroleum Regulatory Commission.
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Lokpobiri gave the revocation warning at a Cross Industry Group meeting held in Florence, Italy, organised by IOCs operating in Nigeria.
According to a statement from the Federal Ministry of Petroleum Resources, the meeting “focused on challenges, expectations, and strategies to enhance the sector’s contributions to domestic energy needs and regional expansion across Sub-Saharan Africa.”
The minister said , “we cannot continue to have assets sitting idle for 20 to 30 years without development. If you are not utilising an asset and it remains underdeveloped for decades, it neither adds value to your books nor to us as a country.
“We encourage industry players to explore collaborative measures such as shared resources for contiguous assets, farm-outs, and the release of underutilised assets to operators ready to invest in production. Otherwise, like any responsible government, we will take back these assets and allocate them to those willing to go to work.”
While urging operators to consider farm-out agreements where assets are close to existing infrastructure, rather than incurring high costs on new floating production storage and offloading units, the minister tasked the operators to ramp up investment in the oil and gas industry.
Speaking on concerns raised by IOCs such as engineering, procurement, and construction contractors, Lokpobiri said “the government has done its part by providing the requisite and investment-friendly fiscal policies, including the president’s executive order incentivising deepwater investments. Now, the ball is in the court of the IOCs and other operators to make strategic investment decisions that will drive increased production and sustainability in the sector.”
He called on the IOCs to support local refining efforts, noting that more refineries are coming upstream and will require a steady supply of crude oil.
