TUE SEPT 10 2024-theGBJournal| The NNPC Ltd. and its Joint Venture (JV) partner, Chevron Nigeria Ltd (CNL), on Monday signed documents on the conversion of five OMLs into four Petroleum Prospecting Licenses (PPLs) and 26 Petroleum Mining Leases (PMLs), in line with the provisions of the Petroleum Industry Act (PIA) 2021.
The GCEO NNPC Ltd., Mr. Mele Kyari and the Director, Deepwater and Production Sharing Contract (PSC) of Chevron Nigeria Limited (CNL), Mrs. Michelle Pflueger, signed the new agreements on behalf of their respective companies, under the watch of the Industry regulator, Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
Under the new PIA regime, all existing Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) would be automatically converted to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) upon their expiration.
Nonetheless, an option of voluntary conversion is provided for holders of OPLs and OMLs (Operator, Licensees or Lessees) under the erstwhile Petroleum Profit Tax (PPT) regime. The PIA terms are generally perceived as more investor-friendly, compared to the erstwhile PPTA terms.
Speaking at the occasion, Group CEO NNPC Ltd., Mr. Mele Kyari, described CNL as one of the most reliable partners for NNPC Ltd. “Over the years, Chevron has been a partner of choice that has not contemplated completely divesting/exiting (oil production in) the shallow water and we are proud of them,” he added.
Kyari assured CNL that NNPC Ltd would sustain its partnership with the JV partner to create more value for both parties and expand Nigeria’s footprints in the domestic and export gas markets.
He commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its exemplary role in midwifing the conversion.
The Director, Deepwater and Production Sharing Contract (PSC) of CNL, Mrs. Michelle Pflueger who stressed the significance of the conversion for both companies, affirmed CNL’s long-standing commitment to the assets.
Also speaking, NNPC Ltd.’s Executive Vice President, Upstream, Mrs. Oritsemeyiwa Eyesan, highlighted the advantages of the PIA terms over the previous PPT terms, noting that the conversion was a strategic move towards the successful implementation of the PIA.
In his remarks, NNPC Ltd.’s Chief Upstream Investment Officer, Mr. Bala Wunti, noted that the assets conversion is expected to significantly boost crude oil production, with the two partners focusing on attaining the 165,000 barrels of oil per day (bopd) production target by year-end, 2024.
He emphasized the continued importance of CNL’s operational philosophy in maintaining network stability and facilitating gas supply especially to the domestic market.
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