Nigeria Petroleum and Gas News

Nigeria announced on Tuesday it would auction 45 exploration blocks to energy companies on May 3, a date which falls between landmark general elections and the handover of power.
Most of the areas on offer by Africa's top oil producer have been revoked from companies that failed to develop them, or were left unclaimed in two previous auctions in 2005 and 2006.
Tony Chukwueke, head of the Department of Petroleum Resources (DPR), said the time required to sell concessions would be shorter than normal in this case because bidders were already familiar with them.
"The blocks which we have retrieved this year are ones which are very familiar. People have been itching for them ... That's what made us think we can succeed in a month," he said during a presentation on the auction to investors and journalists.
Of the 45 blocks on offer, 11 are in deep water offshore, 10 are in shallow water on the continental shelf, 13 are onshore in the Niger Delta, and another 11 are located in little-fancied inland basins.
Nigeria is the world's eighth biggest exporter of crude oil. It has accelerated sales of drilling rights in the past three years in an effort to grow reserves and production capacity, generate income and attract new investment.
Chukwueke said he expected Nigeria to bag $500 million in signature bonuses alone from the auction.
Under the proposed timetable, investors have from now until May 1 to present their offers to the DPR for it to decide which bidders are qualified to take part in the May 3 auction.
Chukwueke said the aim was to sign production sharing contracts (PSCs) with the winners within two weeks of the auction in order to wrap up the whole process before the handover of power scheduled for May 29.
TIGHT TIMETABLE
"It's an extraordinarily tight timetable," said Antony Goldman, an independent risk analyst based in London, pointing out that it took between six and nine months for PSCs to be signed after the last two bidding rounds.
"This raises a lot of issues about whether it's technically possible, and also whether this administration has a mandate to be making an award of this magnitude at this stage, in the last second of its existence," he said.
Nigerians are due to vote for their president, state governors and legislators on April 14 and 21. President Olusegun Obasanjo, who has been in power since 1999, cannot stand for a third term under the constitution.
May 29 is therefore expected to mark the first transition from one elected president to another in Nigerian history.
Energy Minister Edmund Daukoru said this auction was delayed by complaints over the two previous ones. "We had to go back and restructure everything," he said.
The 2005 auction yielded high bids but in many cases the winners were unable to come up with the money.
The 2006 auction, which was on a much smaller scale, generated controversy after one block which went unsold during the public event was later sold behind closed doors to a little-known firm that quickly passed it on for a hefty profit.
One of Nigeria's strategies with its oil rights auctions is to attract investment in its derelict industrial infrastructure by offering a right of first refusal on attractive blocks to foreign firms that commit to put money into projects in Nigeria.
The strategy has yielded promises of major investments in railways, refineries and other projects, mostly by Asian firms which are keen to secure energy resources.
The DPR has shortlisted 17 blocks which could be used to give such investors a right of first refusal in this auction, Chukwueke said. It was a political decision that would be made at the highest level of government, he added.