Nigeria has entered into a new production-sharing contract (PSC) with energy giant TotalEnergies and indigenous firm South Atlantic Petroleum (Sapetro), marking a significant step in its effort to attract fresh investment into its oil sector under the recently introduced petroleum framework.
The agreement covers petroleum prospecting licences (PPL) 2000 and 2001, which were allocated during the 2024 licensing round. Together, the blocks span approximately 2,000 square kilometers in the Niger Delta Basin. According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), TotalEnergies will serve as the lead contractor with an 80% interest, while Sapetro will hold the remaining 20%.
NUPRC Chief Executive, Gbenga Komolafe, described the deal as a milestone for Nigeria’s upstream industry. “This contract sets the stage for a dedicated exploration programme that will help us tap into deepwater resources, grow reserves, raise production levels, and enhance national energy security,” he said.
Key features of the agreement include provisions for signature and production bonuses, minimum work commitments, profit-sharing arrangements, and mandatory contributions to host community development. The contract also incorporates environmental protection clauses, ensuring that operators establish funds for decommissioning and site remediation.
For Nigeria, Africa’s top oil producer, the deal comes at a time when global shifts toward renewable energy and dwindling fossil fuel investment are pressuring traditional oil markets. By securing new exploration commitments, the government hopes to revitalize its upstream sector and position the country to compete effectively in a changing energy landscape.
