NUPRC Mandates Oil Block Development or Forfeiture Under New Petroleum Industry Act Regulatory Framework

NUPRC Chief Oritsemeyiwa Eyesan mandates oil block development under PIA Section 94. Discover how the drill-or-drop rule aims to end asset hoarding in Nigeria.

By: AXL Media

Published: Mar 30, 2026, 3:19 AM EDT

Source: The information in this article was sourced from Business Hallmark

Ending the Era of Exploratory Asset Hoarding

The Nigerian Upstream Petroleum Regulatory Commission, or NUPRC, has officially terminated the practice of companies retaining oil exploration licenses for decades without active development. Commission Chief Executive Oritsemeyiwa Eyesan announced that the regulator is now enforcing the "drill-or-drop" provision, a move designed to ensure that national oil assets contribute directly to the country's production capacity. According to Eyesan, the new regulatory environment eliminates the previous era where some operators held prospecting licenses for as long as 20 years while performing no meaningful exploration work.

Strict Bidding Limits in 2025 Licensing Round

The commission is currently managing a 2025 oil licensing round involving 50 blocks, which has already seen significant interest from international and domestic investors. To encourage a more competitive landscape and prevent any single entity from monopolizing resources, the NUPRC has introduced a cap limiting companies to a maximum of two blocks. This restriction applies whether a firm is bidding as a standalone entity or as part of a larger consortium. Eyesan noted that the outcome of the pre-qualification phase demonstrates a healthy appetite for Nigerian assets despite these more rigorous participation conditions.

Strengthening Oversight and Digital System Integrity

To bolster investor confidence and ensure the legitimacy of the allocation process, the NUPRC has integrated third-party oversight into its digital bidding operations. The regulator partnered with an independent audit firm to interrogate and validate the integrity of the electronic system, ensuring it remains foolproof against manipulation. According to the commission’s leadership, the results of this audit will be made public to provide total transparency, a step that is considered essential for attracting high-quality global investors back to Nigeria’s upstream sector following years of regulatory uncertainty.