NNPCL, TotalEnergies and Sapetro Seal New Deepwater PSC for PPLs 2000 & 2001 in Nigeria
The Nigerian National Petroleum Company Limited (NNPCL), in partnership with TotalEnergies and South Atlantic Petroleum (Sapetro), has signed a landmark Production Sharing Contract (PSC) for deepwater petroleum prospecting licences PPL 2000 and 2001—spanning approximately 2,000 square kilometers in the Niger Delta Basin. This agreement marks the first of its kind under the Petroleum Industry Act (PIA) 2021 to include provisions for both oil and natural gas development. Key highlights include:
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Stake Distribution: TotalEnergies holds 80%, while Sapetro holds 20% interest in the consortium.
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Milestones & Incentives: The contract includes a $10 million signature bonus, plus production-based incentives such as milestone-linked bonuses—in both oil and gas—to accelerate development and reward performance.
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PIA’s First Test Case: NUPRC Chief Gbenga Komolafe described the deal as a “new chapter” in the Nigerian upstream oil and gas sector, illustrating how the PIA is incentivizing investment, transparency, and regulatory stability.
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Broader Economic Significance: The PSC is expected to significantly expand Nigeria’s reserves, boost energy security, attract up to $60 billion in investments by 2030, and enhance local content and corporate responsibility.
Industry Response:
Energy stakeholders lauded the PSC award, praising the fair, transparent bidding process and affirming that such moves are revitalizing confidence in Nigeria’s oil and gas sector.
