NUPRC to revoke idle oil licences, issues October deadline

The Nigerian Upstream Petroleum Regulatory Commission has moved to enforce the “Drill-or-Drop” provisions of the Petroleum Industry Act 2021, warning holders of non-performing oil licences that they risk losing their acreages if they fail to meet their approved work commitments.

The commission gave operators affected by the 2020 Marginal Field Bid Round, 2022/2023 Mini Bid Round and 2024 Licensing Round until October 31, 2026, to disclose their compliance status, identify obstacles delaying operations and submit revised plans for meeting their obligations.

The warning was contained in a circular signed by the NUPRC Chief Executive, Oritsemeyiwa Eyesan, dated September 14, 2026, with reference number NUPRC/1127/Vol.13/55 and obtained by our correspondent on Friday.

The NUPRC’s latest enforcement drive could affect dozens of companies that secured acreages through the 2020 Marginal Field Bid Round, the 2022/2023 Mini Bid Round and the 2024 Licensing Round, with at least 62 successful awardees identified across the three exercises. However, the commission’s October 31 deadline applies specifically to holders whose acreages are not meeting their approved work commitments.

In the circular, obtained by The PUNCH, the commission said the move was part of efforts to increase Nigeria’s oil and gas production by ensuring that licensed acreages are actively explored and developed.

It stressed that the PIA was built around a simple principle that “acreage is held to be worked, and acreage that is not worked within its term returns to the Federal Government.”

The commission said the principle was backed by Sections 77, 78 and 88 of the PIA, alongside the default and revocation provisions contained in Sections 96 and 97.

It warned that enforcement measures could include refusing licence extensions, requiring operators to relinquish acreages, calling in work performance securities and commencing revocation proceedings.

“A petroleum prospecting licence is granted under section 77 of the Act for a defined initial exploration period, with an optional extension determined by the terrain of the acreage and conditional upon discharge of the work commitment applicable to the initial period,” the circular stated.

“The grant carries with it the obligations contained in the instruments constituting the licence, the General Licence Conditions, the Concession Contract, the Minimum Work Programme and the Work Performance Security, which are to be read as one. It is performance of those obligations within the term that entitles a licensee to continue to hold the licence.”

However, the regulator said the immediate objective was not to take away licences but to compel operators to bring dormant or underperforming assets into production.

“The Commission’s objective is to increase production, not forfeiture,” it stated.

The NUPRC acknowledged that operators could face challenges involving financing, rig availability, insecurity, host community engagement, infrastructure, regulatory approvals and disputes among partners.

It therefore asked affected licensees to provide details of the constraints and proposed solutions by October 31.

“Licensees experiencing such constraints are encouraged to notify the Commission not later than 31 October 2026, stating: a. the level of compliance with its licence obligations including the execution of its approved work programme; b. the specific constraints affecting execution; and c. the proposed mitigation measures and revised implementation timeline,” the circular stated.

The commission, however, warned that its willingness to facilitate solutions would not amount to extending licence terms or excusing contractual obligations.

It stated, “The Commission will not assume jurisdiction beyond its statutory mandate, displace any agreed dispute-resolution mechanism or the jurisdiction of the courts, or permit engagement with the Commission to suspend the term of a licence or excuse the performance of any obligation.”

It also warned that disagreements between partners would not shield operators from enforcement.

“Internal disagreement will not excuse failure to meet licence obligations,” it stated.

The affected licences are products of three recent attempts by Nigeria to attract investment and accelerate exploration.

Under the 2020 Marginal Field Bid Round, the NUPRC issued 50 Petroleum Prospecting Licences to successful awardees. The commission had projected that the fields could generate about 58,000 barrels of oil per day and 87 million standard cubic feet of gas per day.

The 2022 Mini Bid Round, conducted under the PIA framework, initially focused on seven deep offshore PPLs and was designed to bring new investors into prospective petroleum acreages.

The process subsequently culminated in the 2022/2023 Mini Bid Round awards. In July 2026, the NUPRC said 12 successful awardees received 19 PPLs from the 2022/2023 Mini Bid Round and the 2024 Licensing Round, covering deep offshore, shallow-water and continental-shelf acreages.

The 2024 Licensing Round was launched as another major effort to deepen exploration under the PIA, offering a mix of deep offshore, shallow-water and onshore opportunities.

The latest enforcement drive therefore puts operators from the three rounds on notice that winning an acreage is not the end of the process.

The NUPRC said all affected licensees should submit the required information within the stipulated deadline, while enquiries are to be directed to its Executive Commissioner, Exploration and Acreage Management, Bashari Indabawa.