The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) on Tuesday disclosed that offering the highest signature bonus alone would not guarantee success in the ongoing 2025 Licensing Round, warning that bidders with weak technical proposals could lose out despite submitting the biggest commercial offers.
Speaking during the Commercial Bid Conference in Abuja, the Deputy Director, Lease Administration, Expiration and Acreage Management at NUPRC, Dr. Amba Egba, said the Commission subjected every bid to a rigorous technical evaluation before opening the commercial bids.
He explained that the technical assessment examined bidders’ understanding of the geology of the block, reservoir development strategy, drilling plans, facilities design, project timelines, health, safety and environmental plans, decommissioning strategy, and economic modelling under the Petroleum Industry Act (PIA).
According to him, bidders also lost marks for basic errors, including referring to the wrong oil block in their submissions.
“The technical bid evaluation was a very rigorous and transparent deterministic process.
“There were instances of conceptual abnormalities where you have Block A and, when submitting, you are referring to Block Q. In those cases, the marks would not be given.”
Egba added that only companies that successfully scaled the technical stage proceeded to the commercial evaluation, where signature bonus offers and work programme commitments were considered.
He stressed that the commercial bids remained encrypted until the official opening, saying, “Nobody has seen it. I don’t even know what it looks like.”
Egba added that after the commercial bid opening, winners would emerge only after meeting all requirements, including providing a valid bid guarantee equivalent to five per cent of the signature bonus, while reserve bidders would also be announced where applicable.
The disclosure reinforces the Commission’s insistence that the licensing round was designed to reward competent developers with credible field development plans rather than firms relying solely on aggressive financial bids.
Explaining why several oil blocks on offer in the ongoing 2025 Licensing Round failed to attract bids, the Commission Chief Executive, Mr. Gbenga Komolafe, said it was due to the high exploration risks associated with frontier acreages.
The Commission, however, said the assets would not be abandoned, assuring that it would carry out additional technical work to de-risk the blocks before returning them to the market.
According to the CCE, the Commission had been transparent from the outset that some of the offered assets were located in frontier basins where geological uncertainties remain high.
“When we launched the bid, we were very transparent and open and explained that some of these assets are in frontier basins. Frontier means that they have not yet been de-risked. So we were not surprised when we saw that some of these assets returned with no bidders.
“What it therefore means is that we will go back and do some more work to de-risk these assets and bring them back to the market. From the studies that we’ve been doing and the work that we need to do, these assets will come up and definitely pick up.”
Komolafe noted that despite the limited interest in some frontier assets, the licensing round recorded strong investor participation, with nearly 300 expressions of interest across different terrains and sedimentary basins.
“It is a reassurance that Nigeria is really an investment destination. You have almost 300 interests. That is phenomenal. We also brought in blocks from different terrains and different basins, and we saw representation of interest across all the terrains.”
The Commission warned that asset performance would continue to be monitored, and non-performing licences would be withdrawn and reallocated to capable investors.
