Lokpobiri Says Companies Must Bear All Risks as Government Tightens Rules Under PIA…
The Federal Government has issued a stern warning to prospective investors participating in the 2025 oil licensing round, declaring that all risks associated with bidding including errors, miscalculations, or unmet expectations will be borne solely by the companies involved.
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, made this clear on Wednesday at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) pre-bid conference in Lagos, which drew strong physical and virtual participation from local and international investors.
The conference was convened to brief prospective bidders on the available oil and gas assets, applicable laws, and the commercial and technical risks tied to the licensing process.
Lokpobiri said the government would no longer tolerate speculative bidding, stressing that oil and gas licences are national assets meant for development not prestige, resale, or long-term hoarding.
“There will be no refunds of bidding fees or signature bonuses under any circumstances,” the minister said, recalling challenges faced after the 2020 bid round.
“I have had to resolve several issues from the previous bid round where some winners came back asking for refunds of their bidding fees. These fees are clearly stated as non-refundable, yet people still came demanding their money back,” he said.
The minister also disclosed that some bidders had complained that the assets they won failed to meet expectations and requested alternative oil blocks.
“Others came to say the acreage they bid for was not good enough and demanded another one. Let me be very clear: the Petroleum Industry Act does not provide for asset exchanges or refunds on such grounds,” Lokpobiri stated.
According to him, once a bid is concluded and an award is made in line with the law, all technical and commercial risks rest squarely with the investor.
“The government has no obligation to refund your money simply because you did not find oil or only discovered gas,” he added.
Lokpobiri further warned against holding licences without development, describing such practices as unproductive and harmful to national interest.
“I have seen people hold licences for over 20 years, proudly travelling around the world saying they own an oil block. But the real question is: what value have you created?” he asked.
The minister stressed that the 2025 licensing round is firmly grounded in the Petroleum Industry Act, noting that Sections 73 and 74 mandate transparent, competitive, and non-discriminatory licensing processes based on financial strength, technical capability, and work programmes.
He urged bidders without sufficient financial capacity to partner with credible operators, adding that hydrocarbons will remain a dominant part of the global energy mix for decades.
“Fossil fuels are not disappearing anytime soon. They will continue to account for more than 50 per cent of global energy supply for the foreseeable future,” Lokpobiri said.
Echoing the minister’s stance, NUPRC Chief Executive, Engr. Oritsemeyiwa Eyesan, said reforms under the PIA have effectively ended practices that encouraged asset hoarding.
“Before the PIA, we had systems that supported block sitting. Today, if you do not work your asset, it will be taken from you. Many of the assets on offer now are recovered fallow fields,” she said.
Eyesan also announced that President Bola Ahmed Tinubu has approved a downward review of signature bonuses and adjustments to other fees payable before first oil, aimed at lowering entry barriers and attracting credible investors.
She revealed that preparations for the 2026 licensing round would commence almost immediately, with preliminary processes running alongside the 2025 round to ensure continuity.
Beyond licensing, Eyesan outlined a broader reform agenda designed to boost oil production, enhance regulatory efficiency, and strengthen hydrocarbon accountability, as Nigeria targets crude oil output of three million barrels per day by 2030.
At a separate stakeholder meeting in Lagos, she disclosed that the commission had launched a 90-day fast-track programme to accelerate approvals for near-ready Field Development Plans, well interventions, rig mobilisation, and other “quick-win” projects capable of delivering early production.
“The commission will now issue quarterly progress reports. Operators with high-impact shut-in fields should bring them forward for approval,” she said, noting that a long shut-in asset had recently been returned to production.
Eyesan said her leadership vision for the upstream sector is anchored on three pillars: production optimisation and revenue expansion; regulatory predictability and speed; and safe, governed, and sustainable operations.
She added that the agenda aligns with President Tinubu’s Renewed Hope Agenda, which targets crude oil production of two million barrels per day by 2027 and three million barrels per day by 2030.
According to her, NUPRC will publish Service Level Agreements to define approval timelines, deploy digital workflows for permitting and data submissions, and run regulation as a service driven by transparency and time-bound decisions.
She urged operators with mature projects to submit proposals by the end of the first quarter of 2026 and announced the establishment of a monthly CCE–Operators Leadership Forum involving NNPC, OPTS, IPPG, and emerging producers.
“Going forward, we will be measured by faster approvals, higher and more secure production, credible licensing, disciplined acreage performance, world-class health and safety outcomes, and trusted data integrity,” Eyesan said.
Nigeria, Africa’s largest oil producer, has struggled with declining output due to underinvestment, oil theft, and regulatory bottlenecks, but the Federal Government says ongoing reforms are designed to restore investor confidence and reverse the downward trend.
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