The Nigerian National Petroleum Company (NNPC) Ltd., in partnership with the TotalEnergies–Sapetro Consortium, has signed a Production Sharing Contract (PSC) for Petroleum Prospecting Licences (PPLs) 2000 and 2001, marking a historic step in Nigeria’s upstream oil and gas industry.
The agreement, executed at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Headquarters in Abuja on Monday, is the first PSC to comprehensively cover both crude oil and natural gas exploration and production, underscoring the Federal Government’s commitment to responsibly harnessing the nation’s hydrocarbon resources.
Speaking at the ceremony, Engr. Bashir Bayo Ojulari, Group Chief Executive Officer of NNPC Ltd., described the deal as a groundbreaking development for Nigeria’s energy sector.
“This particular PSC is unique in many respects. It is the first PSC that comprehensively covers both crude oil and natural gas. It is also the first with robust gas terms, including a profit gas split that incentivises monetisation of non-associated gas,” Ojulari said.
He noted that the contract demonstrates the success of the Petroleum Industry Act (PIA) 2021, while sending a clear signal to the global investment community that Nigeria is open for business. Ojulari further pledged that NNPC Ltd. would leverage such partnerships to deepen upstream operations, applying cutting-edge technology and international best practices to ensure commercial viability and sustainability.
In his remarks, Engr. Gbenga Komolafe, Commission Chief Executive (CCE) of NUPRC, highlighted that the award of the two offshore blocks—spanning nearly 2,000 square kilometres—is a product of the transparent and competitive framework introduced under the PIA. He commended the partners for their commitment, citing past successes in deepwater projects such as Egina and Akpo.
Mr. Matthieu Bouyer, Managing Director/CEO of TotalEnergies E&P Nigeria Limited, described the signing as a reaffirmation of the company’s long-standing commitment to Nigeria, where it has operated for over six decades.
The consortium agreement gives TotalEnergies an 80% interest and Sapetro a 20% stake, with both companies pledging to work closely with NNPC Ltd. to boost reserves, promote local content, and strengthen Nigeria’s energy security.
The PSC includes provisions for signature and production bonuses, a defined minimum work programme with performance guarantees, cost recovery and profit-sharing rules, royalties and taxes, gas utilisation to reduce flaring, and obligations for decommissioning, environmental remediation, and host community development; all in line with the PIA.
