FG Revokes 33 Marginal Oil Field Contracts Over Failure To Pay Signature Bonuses.
The federal government announced on Thursday that 33 marginal field contracts had been revoked because the awardees were unable to pay the expected signature bonuses for the 2020 Marginal field bid round within the 45-day window.
Mr Gbenga Komolafe, Chief Executive Officer of the NUPRC, made the announcement during a meeting with marginal field awardees and leaseholders in Abuja.
The defunct Department of Petroleum Resources (DPR) announced the 2020 marginal field awards in May, with 57 fields on offer and 665 companies expressing interest in acquiring them.
According to him, 128 awardees have made signature bonus payments for the fields thus far, while the commission has raked in approximately N174 billion from the marginal oil field bid round program.
He said: “The marginal field guidelines provided for 45 days for the payment of signature bonus which has since elapsed, and we have issued a public notice to that effect as well as notified the relevant potential awardees.
“It is pertinent to inform you that concerted efforts are being made to ensure that the 2020 MFBR exercise is completed within the shortest possible time.”
He noted that given the high-cost capital and government’s desire to achieve first oil in the fields, the Commission was making concerted efforts “to ensure that the 2020 MFBR exercise is completed within the shortest possible time”.
Komolafe pointed out that “this engagement with Marginal Field awardees and Leaseholders is for the Commission to state the policy position on the 2020 Marginal Fields Bid Round (MFBR), to enable successful awardees progress to field development phase in line with the Petroleum Industry Act (PIA) 2021”.
While revealing that no new marginal field or farm-out agreements were planned under the PIA, he explained that fields were classified as marginal prior to the Act’s enactment when license holders did not consider them for immediate development due to assumed marginal economics under current conditions.