L-R: Chukwuemeke Anagbogu, managing director, South Atlantic Petroleum; Adesua Dozie, general counsel and company secretary at NNPC; Bayo Ojulari, NNPC GCEO; Gbenga Komolafe, chief executive, of NUPRC; Olayemi Adeboyejo, commission secretary and legal adviser, NUPRC; and Mathieu Bouyer, MD TotalEnergies, at the signing of the PSC between the NNPC and the TotalEnergies-Sapetrol Consortium in Abuja on September 1, 2025 | Photo: NUPRC Media
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), on Monday, signed a production sharing contract (PSC) with TotalEnergies and South Atlantic Petroleum (Sapetro) for petroleum prospecting licences (PPL) 2000 and 2001.
The oil blocks, said to be awarded in the 2024 licensing round, cover about 2,000 square kilometres in the Niger Delta Basin.
TheCable learnt that both companies will jointly operate the assets, with TotalEnergies holding 80 percent interest, while Sapetro controls 20 percent.
Speaking at the signing ceremony in Abuja on Monday, Gbenga Komolafe, the chief executive officer (CEO) of the NUPRC, said the deal marks “a new chapter” in Nigeria’s upstream oil and gas industry.
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Komolafe praised President Bola Tinubu for reforms in the sector, including the 2024 executive orders on fiscal incentives, local content, and contract timelines, which he said had catalysed investment inflows.
The CEO said the PSC provides clarity on cost recovery, oil profit sharing, royalties, and host community obligations in line with the Petroleum Industry Act (PIA).
“This PSC signals the start of a committed work programme that will help us unlock the untapped geological potential of our deepwater, expand our reserves, boost production, and strengthen Nigeria’s energy security,” Komolafe said.
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“The terms of the PSC include payment of a signature bonus as stipulated in the licensing round and production bonuses tied to commercial milestones, ensuring value to the Federation; a defined minimum work programme, with the requirement to provide guarantees to assure performance; clear rules on cost recovery and profit oil sharing between the Federation and Contractors, in line with the fiscal provisions of the PIA and applicable laws.
“Payment of royalties and taxes, and strict compliance with the host community development obligations under the PIA; provisions for the treatment of associated and non-associated gas, to ensure optimal utilisation, reduced flaring, and alignment with Nigeria’s gas commercialisation agenda; and obligations relating to decommissioning and abandonment and environmental remediation fund, to ensure environmental protection, transparency and accountability.”
Komolafe expressed confidence in TotalEnergies and partners to fulfil terms within allowed windows for mutual benefits to Nigeria.
“We also expect swift and technically sound exploration, leading to early Final Investment Decisions,” he added.
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“We further urge you to deepen local content, create quality jobs, empower Nigerian businesses, develop and produce the asset in line with decarbonisation principles and uphold the highest standards of sustainability, in line with the PIA’s host community provisions.”
‘FIRST DEEPWATER AWARDED SINCE PIA’
On his part, Bayo Ojulari, the group chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited, described the contract as “unique,” noting that it is the first deepwater PSC awarded since the PIA and the first to comprehensively include crude oil and natural gas terms.
Ojulari said the agreement includes performance-based incentives such as a $10 million signature bonus and production bonuses tied to output milestones, with a cost recovery limit of 70 percent.
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A signature bonus is a non-refundable payment made by a contractor to the government upon the signing of an agreement. Organisations that are awarded oil assets are expected to pay signature bonuses to the government.
“This PSC is an attempt to address the gap of the past with a document that is reflective of the PIA, resilient and complete,” he said.
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“It will help us move closer to the target of three million barrels per day and attract new investments.”
Matthieu Bouyer, the managing director of TotalEnergies Nigeria, said the company is honoured to be part of the first international award in over a decade.
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“This moment comes after an open and transparent bid process. Today marks the beginning of what we hope will be a new chapter of value creation in Nigeria’s upstream sector,” Bouyer said.
On his part, Chukwuemeke Anagbogu, the managing director of Sapetro, said as the company’s current production assets mature, the new assets provide a clear path to increasing its reserve base and “assuring our longer-term production growth”.
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The NUPRC said the PSC underscores its vision to make Nigeria the premier destination for upstream investment in Africa.