Nigeria raises $477 million in Marginal Oil Field development Licenses

The Federal Government of Nigeria (FG) has awarded licenses to develop Margin Oil Fields in Nigeria.

This follows a frustrating two-year process and multiple court cases which earlier restrained the FG from offering licenses to winners of marginal oil fields.

Ijaw leaders in Bayelsa had earlier put up a fight seeking to halt licensing on marginal oil fields located in their areas.

• Awardees will not be expected to develop more oil fields which will significantly boost productivity in the oil sector amidst rising global demand and high oil prices.

• The news was first disclosed in a report by Bloomberg on Tuesday evening, stating that the FG raised the sum of $477 million in the exercise.

What the report said:

The report revealed that the Nigerian Upstream Petroleum Regulatory Commission issued 49 petroleum prospecting licenses to more than 100 companies, compared to the original 57 bids it was seeking 2 years ago.

• Gbenga Komolafe, the agency‘s boss stated that the field sales raised more than N200 billion ($477 million), adding that the FG hopes the sales help boost Nigeria’s declining output.

What you should know

• Nairametrics reported last month that a Yenagoa Division of the Federal High Court has restrained the Federal Government from issuing licenses on marginal oil fields in the Niger Delta, following a 2020 suit by some Ijaw leaders after they approached the court seeking to halt licensing on marginal oil fields located in their areas.

• The plaintiffs include Chief Brown Agu (Opu Agu VIII), Mrs. Rosemary John-Oduone, President Ijaw Women Connect, and Mr. Femowei Friend on behalf of themselves and the Ijaw ethnic nationality.

• They prayed the court to restrain the Federal Government from further advertising and receiving bids in respect of the marginal fields.

• Justice Dashen who granted the order restraining the FG adjourned the matter for June 8 for the continuation of the hearing and ruling on pending motions before the court.

• Marginal fields are shallow fields that may not produce crude oil in commercial quantities immediately and would require further development to boost volume.