By Ali Elias
LAGOS — The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has projected an additional 250,000 barrels per day of oil production from 22 newly awarded petroleum licences within the next five years, while warning that licence holders who fail to commence meaningful operations risk losing their blocks under a renewed enforcement of the Petroleum Industry Act (PIA).
The Commission Chief Executive, Mrs Oritsemeyiwa Eyesan, announced the production target on Tuesday at a two-day onboarding workshop in Lagos for the new awardees, signalling the regulator’s determination to translate licence awards into actual barrels rather than allow valuable oil and gas assets to remain undeveloped.
“For this set of awardees, we are expecting nothing less than 250,000 barrels per day in the next five years at least from the 22 awards,” Eyesan told journalists on the sidelines of the workshop.
She added that Nigeria remained on course to achieve a production target of three million barrels of oil per day by 2030.
The projections place significant expectations on the new licence holders at a time when Nigeria is seeking to strengthen upstream investment, raise production and maximise the contribution of its petroleum resources to government revenue and economic growth.
However, the 250,000bpd target remains a projection, not guaranteed output. Its attainment will depend on the awardees’ ability to secure financing, undertake exploration and appraisal, establish commercial discoveries, develop fields and bring them into production within the anticipated period.
The NUPRC’s intervention therefore appears designed to address one of the longstanding challenges of the upstream petroleum industry: the gap between acquiring petroleum rights and converting them into commercially viable production.
Eyesan said the Commission organised the onboarding programme to guide the new awardees through the technical, commercial and regulatory requirements involved in moving from the award of a licence to first oil.
The workshop, themed “From Award to Production: Delivering Nigeria’s Upstream Potential Under the Petroleum Industry Act, 2021,” brought together subject-matter experts from the Commission and professionals from legal and financial institutions to familiarise the participants with the processes involved in developing their assets.
The first day featured five technical sessions covering the regulatory framework, work programmes, exploration, appraisal and commerciality, field development, well operations and production, as well as exploration financing.
The emphasis on financing is particularly important because securing a petroleum licence does not, in itself, provide the capital required to explore and develop a field. Awardees must be able to mobilise funding, meet regulatory obligations and demonstrate that their proposed operations can progress towards commercial production.
Eyesan urged the new operators to learn from the experiences of previous licence holders, including their successes and mistakes, rather than repeat avoidable setbacks.
But beyond capacity building, the Commission is making it clear that the new awardees will be expected to demonstrate measurable progress within specified timelines.
Eyesan restated October 31, 2026, as the deadline for action against holders of idle oil and gas licences who have failed to undertake the required activities within their stipulated periods.
“We have issued a directive that by the end of this month, those who were awarded licenses, and have not done anything within the stipulated time – three years for those onshore and five years for those offshore – the Commission will call in those blocks,” she said.
“It’s going to be drill or drop. This is standard practice all over the world. In the UK, in the Netherlands, all over the world.”
The warning underscores the regulator’s intention to enforce the work obligations attached to petroleum licences rather than allow awardees to retain acreage indefinitely without undertaking the required exploration or development activities.
Under the PIA framework, licence and lease obligations are intended to ensure that petroleum resources are actively evaluated and developed in accordance with applicable terms and regulatory requirements. The Commission’s announced deadline is therefore a test of how firmly it will enforce those obligations against non-performing operators.
Eyesan also indicated that the era of routine extensions without demonstrated progress was coming to an end.
The Commission chief executive said the regulator expected more than half of the new awardees to achieve first oil within two years, with the operators progressing to subsequent drilling campaigns over the following years.
“We want to see that in the next two years, more than half of you have reached first oil. In the next three, four years, you are drilling your second well,” she said.
The timetable is ambitious, particularly because the journey from licence award to first oil can involve several stages of technical evaluation, financing, exploration, appraisal, field development and infrastructure deployment. The time required will also depend on the characteristics of each asset and whether commercially recoverable hydrocarbons are established.
Nevertheless, the message from the regulator is clear: licence ownership must translate into operational activity and, ultimately, production.
The projected 250,000bpd would represent a meaningful contribution to Nigeria’s ambition to raise output to three million barrels per day by 2030. But achieving that objective will require more than awarding new acreage or announcing production targets. Existing assets must also perform, new discoveries must be commercialised, and operators must overcome the financing and infrastructure challenges that can delay development.
The October 31 deadline will provide an early indication of the Commission’s willingness to apply the drill-or-drop principle in practice. Its effectiveness will ultimately be judged not only by the recovery of idle blocks, but also by whether those assets are subsequently taken up by capable investors and developed.
For the new awardees, the onboarding workshop offers technical guidance and access to regulatory expertise. The harder task begins after the workshop: financing their commitments, meeting work-programme obligations and demonstrating progress towards first oil.
Eyesan’s challenge leaves little room for ambiguity. The new licences are expected to deliver production, while those who fail to meet their obligations risk losing the opportunity to develop their assets.
For Nigeria, the ultimate measure of success will not be the number of licences awarded or the scale of the production forecast, but how many of the promised barrels actually reach the market.