Nigeria’s push to restore confidence in its upstream oil sector took a major step forward as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) concluded a seven-hour commercial bidding exercise that awarded 31 companies oil and gas blocks from a pool of 143 bidders. The exercise, held in Abuja, marked the second consecutive annual licensing round under the Petroleum Industry Act (PIA), signalling a shift from the irregular and often controversial allocation process that previously dominated the industry.
The auction, which offered 50 oil and gas blocks across seven sedimentary basins, was conducted in full public view using an automated scoring system that combined technical competence with commercial bids. According to the commission, winning a block was not solely determined by the highest financial offer, as technical capability, operational readiness, financial strength, and project execution plans also played significant roles in the evaluation. Of the 50 blocks available, only 37 attracted bids, while 13 received no commercial interest and were returned to the government’s licensing pool.
Although regulators hailed the process as one of the most transparent licensing exercises in recent years, concerns remain over how final decisions were reached. Industry stakeholders acknowledged improvements in organisation and digital automation but argued that greater transparency would require the publication of post-bid evaluation reports and detailed scoring criteria. Some participants also suggested that eliminating the remaining manual stages of the exercise would further strengthen public trust and reduce the possibility of human interference.
Energy experts welcomed the return of predictable annual licensing rounds, describing them as a positive development for attracting investment into Nigeria’s oil industry. However, they cautioned that transparency must extend beyond the bidding stage to include clear disclosure of how successful companies were selected. They also stressed the importance of ensuring that awarded firms possess the technical and financial capacity to develop the assets, warning that selecting relatively unknown companies without sufficient scrutiny could revive concerns associated with past discretionary allocations.
While the successful completion of the auction represents progress toward reforming Nigeria’s petroleum sector, experts believe it is only the beginning. They argue that licensing rounds alone will not deliver the country’s ambitious target of producing three million barrels of crude oil per day unless abandoned fields are revived, security challenges are addressed, host communities are engaged, and operators move swiftly from licence acquisition to actual production. With President Bola Tinubu already approving another licensing round for 2026, attention will now turn to whether regulators can build on this year’s progress and address the concerns raised before the next round begins.
source: punch
