TotalEnergies and South Atlantic Petroleum (Sapetro) have entered into a Production Sharing Contract (PSC) for two deepwater blocks covering roughly 2,000 square kilometres in the Niger Delta Basin.
The deal, announced in Abuja on Monday, follows the 2024 licensing round and involves petroleum prospecting licences (PPLs) 2000 and 2001.
According to Gbenga Komolafe, Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the agreement underscores Nigeria’s resolve to unlock untapped offshore resources, expand reserves, and boost production.
He explained that to attract investors, the commission adopted minimal signature bonuses in line with international best practices, citing Thailand, Israel, Guyana, and Brazil as examples.
“Permit me to congratulate TotalEnergies with over 60 years of operations in Nigeria and holding 80 per cent contractor interest, as well as Sapetro with 30 years of operations and holding 20 per cent contractor interest, on your success in the licensing round,” Komolafe said.
He added that the blocks were awarded after a “fair, transparent and competitive bidding process” in line with the Petroleum Industry Act (PIA). The new PSC terms include signature and production bonuses, minimum work commitments, rules for cost recovery and profit-sharing, royalties, taxes, and obligations to host communities.
Bashir Ojulari, CEO of the Nigerian National Petroleum Company Limited (NNPC), said this marks the first deepwater PSC since the 2024 licensing round, covering both oil and gas. He highlighted that it includes forward-looking gas monetisation terms.
The contract specifies a $10 million signature bonus and production bonuses tied to reaching 35 million and 100 million barrels of output, alongside detailed provisions on profit oil and gas splits, cost recovery, and royalties.
“This PSC is a major milestone that speaks to the regulator’s commitment to implementing the provisions of the PIA and will no doubt bring NNPC Limited closer to achieving the target of 3 million barrels per day and an additional investment of $60 billion by 2030,” Ojulari said.
Matthieu Bouyer, Managing Director of TotalEnergies Upstream, said the new blocks align with the company’s focus on high-impact exploration projects.
“This moment comes after an open bid process and transparent bid process completed in December 2024. We are honoured that TotalEnergies and Sapetro are the first international companies to be awarded an exploration block in over 10 years,” he said.
For Sapetro, the new assets offer a pathway to expand reserves and sustain growth as existing fields mature. Chukwuemeke Anagbogu, Sapetro’s Managing Director, said the company remains committed to building its deepwater presence and contributing to Nigeria’s long-term energy security.
