Nigerian National Petroleum Co’s Mele Kyari wants to dispose of a dozen currently under-exploited blocks as quickly as possible. But most of the firms best positioned to win the bids have no experience in the sector.
Nigeria is trying to attract private-sector investment in its oil industry. Time is running out, as the 2025 budget now before parliament is based on output of 2.06 million barrels per day (bpd), a level the country last achieved a decade ago. However, according to official figures submitted by Abuja to the Organization of the Petroleum Exporting Countries (OPEC), average production in 2024 stood at just 1.2 million bpd.
To bridge this gap, Nigerian National Petroleum Co (NNPC) is looking to revitalise a dozen underexploited onshore and shallow offshore blocks. It plans to do so through finance and technical service agreements. NNCP CEO Mele Kyari, who is widely rumoured to be on his way out, has been working for months on a list of potential winners.
British junior Tullow Oil has been negotiating with NNPC for months to acquire a stake in OML 119’s operating lease (AI, 26/11/24). To strengthen its bid, it formed a joint venture with Petralon Energy, a Nigerian firm led by Ahonsi Unuigbé (formerly of First Hydrocarbon Nigeria). However, the permit appears to be slipping from Tullow’s grasp in favour of trading company Bono Energy. Led by Adebanjo Olumuyiwa Omisore, known as “Banjo”, Bono Energy has secured numerous crude allocations from the Nigerian state since Kyari took over at NNPC in 2019.
New players enter
Despite having no expertise in oil production, Bono proposed forming a technical partnership with Tullow in November. However, the British company, keen to operate the block itself, has so far refused any such deal. Determined to avoid losing out to Bono Energy, Tullow’s South African chairman, Phuthuma Nhleko, attempted to meet Nigerian President Bola Ahmed Tinubu during his visit to France in November, but without success.
Nhleko is now pushing for another meeting with the aim of convincing the Nigerian authorities that only experienced oil operators can help boost the country’s production.
But Bono Energy is not giving up. Metropole Energy Resources, a trading firm, is reportedly well-placed to win OML 66. According to our sources, Bono Energy is one of Metropole’s shareholders. The company’s directors, Olayinka Temitope Olumuyiwa and Fayole Ayodeji, are completely unknown in Nigeria’s oil sector.
No track record
Bono Energy is not the only company that the NNPC chief wants to see among the winners of this restricted tender. OML 11 could be awarded to Pasadena Resources, whose directors, Magdalene Nwakuso Osude and Peter Ikechekwu Osude, are also unknown in the industry. Meanwhile, OML 64 is reportedly set to go to Geoplex, an oil services firm run for two decades by Wole Ogunsanya, a former Schlumberger executive.
OML 13 is expected to go to Dutchford E&P, a company led by Olatimbo Ayinde. Its shareholders, Sheriff Mohamed Nurmala and Alhaji Sheriff Mala Modu, are brothers of Ali Modu Sheriff, the former governor of Borno State, the same region Kyari comes from. Dutchford also holds contracts for a field within OML 70.
Meanwhile, OML 98 may be awarded to Paragon Holdings, an oil services firm founded by billionaire Prince EOC Eludoyin, a close friend of Tinubu for the past five decades. The company’s directors, Elusanmi Eludoyin and Adetayo Adeyeye, are also unknown in the oil sector.
Beyond these six blocks, NNPC is set to allocate at least another half-dozen oil mining licences in the coming weeks. Among them are the shallow offshore blocks formerly held by Sinopec subsidiary Addax Petroleum: OMLs 123, 124, 126 and 137, which together produce 25,000bpd. These permits were taken over by NNPC in 2022 following lengthy legal battles in the final months of Muhammadu Buhari’s presidency
