Why new firm won oil blocks in 2024 round — NUPRC
CHIGOZIE AMADI
The Nigerian Upstream Petroleum Regulatory Commission has explained why a new company won oil blocks in the 2024 licensing bid round.
There were complaints that Panout Oil & Gas, an eight-day-old oil company (as of the time of the bid), won oil blocks. At the licensing round commercial bid conference held in Lagos last December, Panout Oil & Gas beat TotalEnergies and three other bidders to secure PPL 300/301 CS. Panout also claimed PPL 3015.
This has been described as “illegal” in some quarters, questioning the commission’s adherence to its regulations. Reacting, the NUPRC said in a statement that “no violations of oil licensing guidelines occurred during the 2024 Oil Block Licensing Round.”
The regulator refuted the allegations, clarifying that the entire process was conducted in strict compliance with the Petroleum Industry Act and its own licensing guidelines, “ensuring a transparent, competitive and technology-driven” bidding exercise.
The Chief Executive of the NUPRC, Gbenga Komolafe, said contrary to claims that a particular company registered days before the commencement of bidding was improperly awarded oil blocks, the Commission, “the bid guidelines do not restrict participation based on the age of a company’s incorporation.”
Instead, Komolafe said “a rigorous assessment of technical expertise, financial strength, and legal compliance” determined eligibility.
Komolafe emphasised that the technical and financial capacity of a bidder was assessed not merely by the date of incorporation of the bidding entity, but by the pedigree and proven track record of its promoters, affiliated companies, or parent organisations.
This approach, he said, allowed newly formed ‘Special Purpose Vehicles’, when backed by credible and experienced industry players, to compete effectively and fairly.
“The 2024 Licensing Round involved multiple stages, including prequalification, technical evaluation, and commercial bid evaluation. Applicants were required to demonstrate financial capability, technical expertise, and legal compliance by submitting detailed documentation, such as incorporation papers, tax clearances, and proof of operational experience.
“The pre-qualification window was open with no restrictions on company age,“ he emphasised.
The NUPRC boss maintained that the commercial bidding phase was carried out digitally using encrypted technology to ensure the integrity and confidentiality of the data, stressing that the “results were announced transparently and publicly, featuring live televised sessions that were observed by stakeholders, including the Nigerian Extractive Industry Initiative and relevant government ministries.”
He argued that the commercial bid evaluation was conducted using a “transparent, digital and point-based assessment system”, which included Signature Bonus, Proposed Work Programme Financial Commitments and Work Performance Security.
The statement highlighted that indigenous oil companies ‘aggressively’ participated and outbid some national and international players, reflecting strong investor confidence following the enactment of the PIA 2021.
“At the conclusion of the process, NEITI publicly commended the transparency of the exercise after witnessing the entire procedure. The report praised NUPRC for significant improvements in the 2022-2023 Mini Bid Round and the 2024 Licensing Round, emphasising professionalism, transparency and inclusivity.
“The commission insisted that the 2024 Oil Block Licensing Round adhered fully to all statutory provisions and guidelines, with no discrimination or corrupt practices involved.
“The NUPRC remains committed to transparent regulation aimed at optimizing Nigeria’s hydrocarbon resources and attracting investment under President Bola Ahmed Tinubu’s administration,” the statement concluded.
