TotalEnergies, Sapetro sign production sharing contract for two offshore blocks in Niger Delta

TotalEnergies and South Atlantic Petroleum (Sapetro) have signed a Production Sharing Contract (PSC) for two offshore blocks covering roughly 2,000 square kilometres in the prolific Niger Delta Basin.

The PSC, which applies to Petroleum Prospecting Licences (PPLs) 2000 and 2001, was awarded during the 2024 licensing round. The agreement represents the first deepwater offshore PSC from that round.

Speaking at the signing ceremony in Abuja, Gbenga Komolafe, Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), said the deal demonstrates Nigeria’s commitment to unlocking untapped deepwater resources, expanding reserves, increasing production, and strengthening energy security.

Komolafe explained that the 2024 licensing round introduced a reform-driven framework with minimal signature bonuses to attract investors, bringing Nigeria in line with global best practices. “These terms provide certainty for investors, fairness for the Federation, and clarity for all parties,” he said.

The PSC includes a $10 million signature bonus, production bonuses tied to commercial milestones, and comprehensive terms for crude oil and natural gas, particularly non-associated gas. It also establishes obligations covering royalties, host community development, gas commercialisation, environmental protection, and decommissioning.

Bashir Ojulari, Group Chief Executive Officer of NNPC Limited, described the contract as a milestone that supports Nigeria’s goal of raising oil production to three million barrels per day and attracting an additional $60 billion in investment by 2030.

For TotalEnergies, the award represents the company’s first exploration block in Nigeria in more than a decade. “These opportunities have the potential to deliver low-cost and low-emissions developments,” said Matthieu Bouyer, Managing Director of TotalEnergies Upstream Companies in Nigeria.

Chukwuemeke Anagbogu, Managing Director of Sapetro, called the deal “a transformative step” that will expand the company’s reserves and strengthen its position in the deepwater sector.