Nigeria will offer 31 licenses for oilfields with volumes too low for bigger companies to domestic operators next month to broaden the range of industry investors.
Sixteen onshore fields and 15 in shallow-water leases will be auctioned, Petroleum Minister Diezani Alison-Madueke said.
“Government encourages companies where possible to bid in consortia to enable the parties leverage upon each other’s strengths,” she told reporters today in the capital of Abuja. There will be 3-1/2 months of competitive bidding, she said.
The fields produce volumes too low to be profitable for companies like Royal Dutch Shell Plc (RDSA) and Exxon Mobil Corp. (XOM), who run ventures with state Nigerian National Petroleum Corp. Such ventures, also with Chevron Corp., Total SA and Eni SpA, pump more than 90 percent of the biggest African producer’s oil.
The plans come a decade after a first set of 24 so-called marginal fields were handed to 31 local producers.
Output from eight of those now makes up 1 percent of the country’s total, adding 100 million barrels of crude to the country’s reserves, according to the minister. Nigeria, OPEC’s seventh-largest producer, pumped 1.99 million barrels of oil a day in October, according to data compiled by Bloomberg.
Nigerian companies “continued to demonstrate remarkable technical ability in operating significantly larger assets” by buying fields from international producers, Alison-Madueke said.
Local producers including Seplat Petroleum Development Co. and Oando Plc are raising their share of the country’s output by agreeing to take fields in restive areas when global producers like Shell and Chevron retreat. Stakes in 13 fields were sold by Shell, Total and Eni from 2010, mostly to domestic companies.
To contact the reporter on this story: Elisha Bala-Gbogbo in Abuja at email@example.com