The Minister of Petroleum Resources (Oil), Heineken Lokpobiri, has refused to approve the extension of more than fifty expired oil licences.
He recently revealed that the licences are currently on his table, awaiting extensions.
Speaking at the PENGASSAN energy and labour summit in Abuja, Heineken Lokpobiri declared that despite awarding over sixty licences in a marginal bid round that happened a few years ago, fewer than six of them have actually invested in the assets ever since.
According to him, he will not give licenses to people who willingly apply for it without making tangible efforts to invest in them.
He stated that if all sixty licence holders produced just 2,000 barrels per day, it would have guaranteed 120,000 bpd over the years.
“We need to take steps that will increase oil volumes. One of the ways we can increase the volume is for those licence holders to produce. You will agree with me that there was a marginal bid round a few years ago where over 60 people got licences. If each of them produces even 2,000 barrels per day, that is 120,000 bpd.
But today, the record available to me clearly shows that fewer than six of them have been able to make the investments needed up to production. Our government has a job to do. The PIA said it is either you drill or you drop. Why should we give licences to those who willingly applied for those licences but haven’t shown capacity to invest in them?” he asked.
He further noted that Nigeria needs every available well to produce daily to meet both local and international demands.
Lokpobiri concluded by saying that renewing the licences would be impoverishing the holders by making them waste hard-earned money to show up at conferences.
“We need every available well to be brought to production as part of our deliberate steps towards increasing production. The message I want to drop here is that they already have licences on my table seeking an extension. And I asked a question, ‘Why should I extend the licences of those people who haven’t shown capacity? Am I not suffering them more?
The longer I give you the opportunity to wear the best suit in the world, going round all conferences, wasting the money you don’t even have, the more harm I’m doing you. So, it is better for me to decline that extension so that you can find something else to do. Let’s give those licences to those who have proven capacity financially and technically, as part of my efforts towards increasing production to meet our domestic demand
While the refiners need the crude, the producers want to sell the crude at the best price. The refiners said they must sell it at a lower price. I’m always dealing with it. Sometimes the producers will say they have pre-existing obligations; before they raised finances to invest, they’d committed to the barrels.
But I’ve always told them that the only solution is for us to increase the volumes. Increase the volumes, and then you’ll be able to meet both your local and international obligations. That’s why I’m saying that licence holders have obligations, and the government has an obligation. The government has created the best environment through the reforms and executive orders,” he added.
Folami David is a dynamic journalist who views the world through an analytical lens, translating complex narratives across multiple industries into compelling stories. With an insatiable appetite for information and a keen eye for emerging trends, Folami specializes in uncovering the interconnections between technology, business, culture, and society.
