Nigeria has officially launched its 2025 oil licensing round, unveiling 50 new oil and gas blocks for prospective investors as part of a broader strategy to revitalise its struggling petroleum sector and increase production capacity. The announcement was made on Monday by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which oversees exploration and licensing in the country’s oil and gas industry.
The latest licensing round includes a diverse mix of assets aimed at appealing to both local and international energy companies. According to the NUPRC, the available blocks are made up of 15 onshore fields, 19 located in shallow offshore waters, 15 frontier basin assets, and one deepwater block. This mix is designed to accommodate a wide range of operators, from smaller indigenous firms to large multinational oil companies with experience in complex offshore environments.
Speaking to journalists during the launch, NUPRC Chief Executive Gbenga Komolafe stated that the 2025 round has the potential to generate enormous economic benefits for the country. He estimated that it could attract nearly $10 billion in new investments over the next decade and contribute up to 2 billion barrels of additional oil production during that same period. When fully developed, the new fields could add as much as 400,000 barrels per day to Nigeria’s current output.
“This licensing round is an important step in unlocking Nigeria’s untapped hydrocarbon potential,” Komolafe said. “When these assets come on stream and reach peak production, they will significantly enhance our national output and strengthen government revenues.”
Nigeria is Africa’s largest crude oil producer, but in recent years it has struggled to meet its full production capacity. Challenges such as pipeline vandalism, crude theft, aging infrastructure, regulatory uncertainty, and underinvestment have contributed to lower-than-expected output. At times, the country has even fallen below its production quotas set by OPEC, the global oil producers’ group to which it belongs.
In response to these issues, the Nigerian government has introduced a series of reforms aimed at creating a more transparent, efficient, and business-friendly energy sector. One of the most significant changes was the passage of the Petroleum Industry Act (PIA) in 2021. The law restructured the industry, separated regulatory responsibilities, and introduced new fiscal terms designed to encourage both domestic and foreign investments. The 2025 licensing round is seen as a continuation of these reforms.
Komolafe noted that although Nigeria conducted a licensing round in the previous year, the award of new oil blocks does not immediately translate into increased production. After blocks are awarded, companies still need time to carry out geological surveys, conduct environmental assessments, drill test wells, and develop infrastructure before commercial production can begin.
“New barrels take time to materialise,” he explained. “While companies that won blocks in the last licensing round have paid their signature bonuses and begun various stages of exploration and development, the process from award to actual production can take several years.”
Nonetheless, officials say they are confident that the current round will generate even greater interest, especially from indigenous oil firms that have grown in strength following the recent divestment of assets by some international oil companies. In the past few years, major global firms such as Shell, ExxonMobil, and Eni have sold some of their onshore and shallow water acreage in Nigeria, creating opportunities for local players to take over operations.
Energy analysts believe the inclusion of frontier assets—areas that have not been fully explored for hydrocarbons—could also attract attention from investors willing to take on higher risk in exchange for potentially significant rewards. Some of these frontier basins are located in northern and central Nigeria, regions that have remained largely untapped compared to the traditional oil-producing Niger Delta.
The deepwater block included in the round is also of special interest. Deepwater projects usually require advanced technology and significant capital, but they have the potential to deliver large volumes of crude oil over long production lifespans. With global energy demand still strong in many parts of the world, such high-capacity projects remain attractive despite the ongoing global shift toward renewable energy.
The Nigerian government, which relies heavily on oil exports for foreign exchange earnings and budgetary revenue, is banking on the success of the 2025 licensing round to help stabilise its economy. Oil revenues support critical sectors such as healthcare, education, infrastructure, and national security. Declining output in recent years has placed pressure on government finances and contributed to rising inflation and currency challenges.
In addition to increasing production, authorities say they are also paying greater attention to environmental protection and community relations in oil-producing areas. Past operations in the Niger Delta caused significant environmental damage, leading to pollution of land and waterways and sparking tension between local communities and oil companies. Under the Petroleum Industry Act, companies are now required to contribute to host community development trusts, which aim to improve living conditions in communities affected by oil and gas operations.
As the bidding process opens, local and international companies are expected to begin analysing data on the blocks, planning work programmes, and preparing competitive bids. The NUPRC has assured potential investors that the process will be transparent and strictly guided by international best practices, with clear timelines and evaluation criteria.
With rising global competition for energy investment, Nigeria’s latest move signals its determination to remain a major player in the oil and gas sector. The success of the 2025 licensing round could mark a turning point for the country’s industry, offering hope of renewed growth, job creation, and long-term economic stability if properly managed.
Source:Africa Publicity
