The Nigerian National Petroleum Company (NNPC) Ltd, in partnership with the TotalEnergies–Sapetro Consortium, has executed a landmark Production Sharing Contract (PSC) covering Petroleum Prospecting Licences (PPLs) 2000 and 2001.
Speaking at the signing, Group Chief Executive Officer of NNPC Ltd., Engr. Bashir Bayo Ojulari, described the agreement as a “powerful testament” to the transformative impact of the Petroleum Industry Act (PIA) 2021.
“This particular PSC is unique in many respects. It is the first PSC that comprehensively covers both crude oil and natural gas.
“It is the first with robust gas terms, including a profit gas framework that incentivises the monetisation of non-associated gas.”
Engr. Bashir Bayo Ojulari, Group Chief Executive Officer of NNPC Ltd.
He emphasised that the deal is not just a contract signing but also a signal to the global investment community that Nigeria is open for business under a reformed and transparent regulatory regime.
According to him, NNPC Ltd. is committed to leveraging such partnerships to deepen upstream operations and deliver commercial viability while maintaining high sustainability standards.
The agreement, signed at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Headquarters in Abuja, is being hailed as a turning point for Nigeria’s upstream oil and gas sector.
The contract is the first of its kind to comprehensively cover both crude oil and natural gas exploration and production, underscoring Nigeria’s ambition to responsibly harness its hydrocarbon resources while expanding its economic base.
Ojulari noted that with advanced technology and proven expertise, the partnership aims to replicate and surpass the successes of previous deepwater projects, positioning Nigeria as a stronger player in global energy markets.
Regulatory Backing for Transparency and Reform
Also addressing the gathering, Engr. Gbenga Komolafe, Chief Executive of NUPRC, said the award of the two offshore blocks, covering an area of nearly 2,000 square kilometres, was a direct outcome of the transparent, competitive, and reform-driven framework ushered in by the PIA.
“The Petroleum Industry Act has created a level playing field and given investors confidence in the fairness of Nigeria’s upstream sector. What we are witnessing today is the fruit of those reforms.”
Engr. Gbenga Komolafe, Chief Executive of NUPRC
He commended TotalEnergies, which holds an 80% interest, and Sapetro, with a 20% stake, for their commitment to exploration and production, referencing earlier successes in assets such as Egina and Akpo, which have played pivotal roles in Nigeria’s oil output.
For TotalEnergies, the agreement represents both continuity and renewal. Mr. Matthieu Bouyer, Managing Director/CEO of TotalEnergies E&P Nigeria Limited, described the signing as a reaffirmation of the company’s “deep and enduring commitment” to Nigeria, where it has operated for more than six decades.
“These blocks, awarded through an open and transparent bid process, are particularly significant because they mark the first deepwater assets secured by an international oil company in Nigeria in over ten years.”
Mr. Matthieu Bouyer, Managing Director/CEO of TotalEnergies E&P Nigeria Limited,
Bouyer added, “This highlights our belief in Nigeria’s future as a top-tier energy producer.”
Mr. Chukwuemeke Anagbogu, Managing Director of Sapetro, echoed the optimism, stating that the deal demonstrates Sapetro’s alignment with the government’s vision for responsible resource utilisation, local content advancement, and inclusive economic growth.
“These blocks provide a clear pathway to increasing reserves and ensuring long-term production growth.
“They also reaffirm our belief in Nigeria’s capacity to deliver sustainable value creation not just for shareholders but for the nation as a whole.”
Mr. Chukwuemeke Anagbogu, Managing Director of Sapetro
Comprehensive Agreement Under the PIA
Unlike older agreements, the new PSC includes robust provisions in line with the Petroleum Industry Act.
These cover signature and production bonuses, minimum work programmes with performance guarantees, rules for cost recovery and profit-sharing, as well as obligations for royalties and taxes.
Importantly, the contract places strong emphasis on gas utilisation to reduce flaring, environmental remediation, decommissioning responsibilities, and host community development.
Officials noted that these provisions reflect the government’s dual focus on resource optimisation and sustainability.
The PSC is expected to boost Nigeria’s hydrocarbon output significantly while also contributing to the country’s 2030 zero-flaring commitment.
By securing this agreement, NNPC Ltd., TotalEnergies, and Sapetro have positioned themselves to drive the next phase of Nigeria’s deepwater oil and gas development.
For the Federal Government, it represents both a policy success under the PIA and a tangible step toward improved energy security and economic resilience.
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