TotalEnergies, in partnership with South Atlantic Petroleum Limited (SAPETRO), has signed a Production Sharing Contract (PSC) with the Nigerian National Petroleum Company Ltd (NNPC Limited) for Petroleum Prospecting Licenses (PPL) 2000 and 2001, marking the first such agreement under the Petroleum Industry Act (PIA) to cover both crude oil and natural gas exploration and production.
The licenses, awarded in the 2024 Licensing Round by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), cover approximately 2,000 square kilometers in the prolific West Delta basin, with a work program that includes drilling one firm exploration well.
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The signing ceremony, held on Monday at NUPRC’s headquarters in Abuja, marked the conclusion of the 2024 Licensing Round, the first deep offshore bid round in over a decade. TotalEnergies holds an 80% contractor interest, while SAPETRO holds 20%. The PSC includes a $10 million signature bonus, production bonuses tied to commercial milestones (two million and four million barrels or equivalent cash payments upon reaching 35 million barrels), and obligations for decommissioning, abandonment, and environmental remediation. The agreement also mandates a minimum work program with performance guarantees.
NNPC Group CEO, Mr. Bashir Bayo Ojulari, described the PSC as a “major milestone” in achieving Nigeria’s target of three million old barrels per day and attracting $60 billion in investments by 2030. He highlighted the PSC’s unique scope, covering both crude oil and non-associated gas in deep water, a key focus post-PIA.
TotalEnergies’ Senior Vice-President Exploration, Kevin McLachlan, expressed pride in the award, noting its alignment with the company’s strategy to pursue low-cost, low-emission developments. “TotalEnergies is honored to be the first international company awarded exploration licenses in Nigeria in over a decade,” he said. Managing Director Mathieu Bouyer added that the company aims to spud its first well on the blocks swiftly, following a transparent bid process concluded on December 18, 2024.
SAPETRO Managing Director, Mr. Chukwuemeke Anagbogu, praised NUPRC’s leadership and the transparency of the process, calling it “completely free and fair.” The consortium’s success underscores Nigeria’s push to open its deep-water frontiers, with TotalEnergies leveraging its 60 years of operations in the country and SAPETRO its 30 years of expertise.
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