NUPRC Implements Drill-or-Drop Rule for Oil Blocks

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has enforced a "drill-or-drop" rule as part of the Petroleum Industry Act, compelling oil companies to either commence exploration and development activities within a specified timeframe or surrender their licenses. Oritsemeyiwa Eyesan, the NUPRC Chief Executive, emphasized that this reform addresses the long-standing issue of companies holding oil blocks for decades without development, which has hindered Nigeria's efforts to expand its petroleum reserves.

The 2025 licensing round will offer 50 oil blocks, with a strong level of investor interest noted despite stricter bidding conditions. Eyesan highlighted that the new policy aims to prevent asset hoarding and encourage wider participation from genuine investors.

Additionally, the NUPRC is engaging independent audit firms to ensure transparency in the licensing process. The reforms are expected to restore investor confidence and create new opportunities in Nigeria's upstream sector, which has faced challenges due to regulatory uncertainties and security issues.