FG revokes 33 marginal field contracts due to nonpayment of signature bonuses

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) announced on Thursday that 33 marginal field contracts had been revoked because the awardees had failed to pay the expected signature bonuses for the 2020 Marginal field bid round within the 45-day window.

Mr Gbenga Komolafe, the NUPRC Chief Executive, made the announcement at a meeting with marginal field awardees and leaseholders in Abuja.

The defunct Department of Petroleum Resources (DPR) announced the 2020 marginal field awards in May, with 57 fields on offer and 665 companies expressing interest in acquiring them.

According to him, 128 awardees have made signature bonus payments for the fields so far, implying that the commission has made N174 billion from the marginal oil field bid round program.

“The marginal field guidelines provided for 45 days for signature bonus payment, which has since elapsed, and we have issued a public notice to that effect as well as notified the relevant potential awardees,” he said.

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It’s important to let you know that concerted efforts are being made to ensure that the 2020 MFBR exercise is completed as quickly as possible.”

Given the high cost of capital and the government’s desire to achieve first oil in the fields, he said the Commission was working hard “to ensure that the 2020 MFBR exercise is completed as quickly as possible.”

“This engagement with Marginal Field awardees and Leaseholders is for the Commission to state the policy position on the 2020 Marginal Fields Bid Round (MFBR), allowing successful awardees to progress to field development phase in line with the Petroleum Industry Act (PIA) 2021,” Komolafe said.

While revealing that the PIA does not envision any new marginal field or farm-out agreements, he explained that fields were classified as marginal prior to the Act’s enactment when license holders did not consider them for immediate development due to assumed marginal economics under current conditions.