On Tuesday, Senator Heineken Lokpobiri, the Minister of State for Petroleum Resources (Oil), threatened to take idle oil blocks away from owners, citing the Federal Government’s 2025 output target of 2.06 million barrels per day.
In keeping with the push to increase oil output, Sen. Lokpobiri stated that the government will start putting the
Petroleum Industry Act’s (PIA) “drill or drop” clauses into effect.
In February 2025, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) stated that oil production was 1.67 million barrels per day.
IOCs operating in Nigeria organised a Cross Industry Group conference in Florence, Italy, where Senator Lokpobiri
made this comment, according to a statement from the Media Aide to the Minister, Nneamaka Okafor.
Challenges, expectations, and strategies to improve the sector’s contributions to local energy demands and regional expansion throughout Sub-Saharan Africa were the main topics of the meeting.
“We cannot continue to have assets sitting idle for 20 to 30 years without development,” the Minister said. An asset
doesn’t contribute value to your books or to our nation if you don’t use it and it stays untapped for decades.
“We encourage industry players to explore collaborative measures such as shared resources for contiguous assets,
farm-outs, and the release of underutilised assets to operators ready to invest in production. Otherwise, like any responsible government, we will take back these assets and allocate them to those willing to go to work.”
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In order to avoid paying exorbitant expenses on new Floating Production Storage and Offloading (FPSO) units, the
Minister also asked operators to think about farm-out agreements where assets are near existing infrastructure.
Lokpobiri called on Nigeria’s International Oil Companies (IOCs) to increase their investment in the oil and gas sector,
pointing out that President Bola Ahmed Tinubu’s administration has offered all the incentives required to guarantee smooth and successful operations.
While IOCs have identified Engineering, Procurement, and Construction (EPC) contractors as a challenge, Sen.
Lokpobiri clarified that EPCs will only make commitments in response to robust investment decisions made by industry participants.
He said, “The Government has done its part by providing the requisite and investment-friendly fiscal policies, including
the President’s Executive Order incentivizing deepwater investments. Now, the ball is in the court of the IOCs and other operators to make strategic investment decisions that will drive increased production and sustainability in the sector.”
He emphasised the need for IOCs to support local refining efforts, noting that more refineries are coming on stream
and will require a steady supply of crude oil.
To make this easy and possible, he stressed that ramping up production will enable Nigeria to meet both local and international obligations.
The Chairman of the Oil Producers Trade Section, OPTS, Mr Osagie Osunbor, commended the Minister for his direct engagement with industry players and for the Federal Government’s continued efforts in advancing the sector.
“We appreciate the government’s commitment to creating a conducive environment for investment. The Minister’s
engagement has provided critical insights and has also challenged us as industry players to step up efforts to increase production,” he stated.
