On Monday, May 31, 2021, the Nigerian Department of Petroleum Resources (DPR) granted marginal oil field licenses to winning bidders for the 2020 Marginal Oilfield Round in a ceremony held in Abuja, the country’s Federal capital territory.

Some of the indigenous oil firms awarded are A.A. Rano, Shafa Exploration, Matrix Energy, Vhelblerg Exploration, Sigmund Oil Field, Emadeb Energy, Casiva Ltd, Duchess Energy and Duport Midstream.

The Director of DPR, Auwalu Sarki, said at the ceremony that the Department would not abandon the companies after the award, but would work with them to ensure immediate development. He assured that the indigenous companies would not face any challenges from the original lease owners for the fields, which are International Oil Companies.

According to him, the fields will raise the country’s daily oil production capability above the existing three million barrels per day, with the 57 fields set to be producing an additional 100 million barrels of petroleum.

He noted that 161 companies were shortlisted as possible winners for the bid round after undergoing rigorous processes for onshore, swamps, and offshore fields, with 50% meeting all.

He also stated that the Department has identified and addressed the problems that had hampered the full development of the last marginal fields awarded in 2003.

Excerpts from his submission:

“The journey began exactly one year ago, 1stJune 2020 with the launching of the Bid round registration portal. The portal eased the registration and application process and ensured a transparent exercise. It also provided the platform for the virtual data room.”

“It is important to state that the industry-enabled National Data Repository (NDR) provided all the requisite technical and logistics support for the successful conduct of the exercise.”

“With the lessons of the previous exercise we want to refocus, change the approach, we have developed strategy to ensure you (the companies) and the awarded fields achieve early development.”

“The DPR will continue and guide all of you every step of the way. For instance, the guiding template for working agreement has been drafted for joint awardees and discussions have reached advance stage between DPR and lease holders on the farm out agreement”

“All the awardees have to recruit people which mean more taxes and revenue to government and at the same time it enhances the GDP because the contribution of the industry to the GDP is very low.”

“What DPR did was evaluate various recovery factors. We saw the average recovery value that we do have now, ranges from 27-38. If we increased this by five percent only across, we will hit the 40 billion barrels and at the same time we will hit above three million barrels.”

“We have identified 7,000 reservoirs and we are producing from about 1,700 reservoirs. We took each of the producing reservoirs to see what kind of enhanced oil recovery that we need to put and once we put the secondary and tertiary recovery methods, technically we grow the reserves and production for the country”.

Speaking on behalf of the bid winners, the Chairman of Vhelblerg, Bank Anthony Okoroafor, said: “It was open to everybody, there was communication established with everybody and they did their own work very well.”