Thirty-one companies emerged winners from 143 bidders in the seven-hour 2025 licensing round, but experts want clearer scoring and stronger proof of capacity

Nigeria’s Nigeria oil bid round has produced 31 successful companies from 143 bidders following a seven-hour commercial auction in Abuja, marking another step towards a more regular and open system for allocating the country’s petroleum assets, while renewed questions over transparency, technical capacity and the ability of winners to develop the blocks remain.

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The commercial bid conference, organised by the Nigerian Upstream Petroleum Regulatory Commission at the Transcorp Centre in Abuja, brought together oil executives, bidders, regulators, observers and journalists as companies competed publicly for 37 of the 50 oil and gas blocks offered in the 2025 licensing round.

The exercise, which began shortly after 11am and ended at 6:13pm, represented a notable departure from the long periods of uncertainty that once defined Nigeria’s oil block allocation system.

For decades, competitive licensing rounds were conducted irregularly, sometimes leaving years between major auctions. Regulatory uncertainty, litigation and discretionary allocations contributed to persistent concerns about how some of the country’s most valuable petroleum assets were awarded.

The current licensing framework is beginning to change that pattern.

Following the 2024 licensing round, the 2025 exercise represents the second consecutive year in which companies have competed for Nigerian oil and gas assets through a structured process, with another round expected in 2026.

For an industry that once experienced a 17-year gap between major general oil block bid rounds, consecutive annual competitions could signal a more predictable approach to upstream investment and asset management.

The 2025 round was announced by the Federal Government on November 11, 2025, under the Petroleum Industry Act 2021.

Fifty blocks were placed on offer across seven sedimentary basins, including 16 blocks in the Niger Delta Onshore, 18 in the Niger Delta Shallow Water and one in the Niger Delta Deep Offshore.

The offering also covered three blocks in the Benin Basin Onshore, four in the Anambra Basin Onshore, four in the Chad Basin Onshore and four in the Benue Trough.

The bid portal opened on December 1, 2025, followed by a pre-bid conference on January 14, 2026. Registration closed on February 27, while prequalification was completed on March 16.

Yet, as the auction unfolded, the process also exposed some of the challenges facing Nigeria’s effort to attract fresh investment into its upstream sector.

NUPRC Commission Chief Executive Oritsemeyiwa Eyesan made clear that the highest financial offer would not automatically secure an oil block.

Instead, she said technical competence, organisational capacity and the ability to execute the proposed work programme would be central to determining successful bidders.

The position reflects an attempt to avoid a system in which companies with the deepest pockets automatically prevail, even when they may lack the expertise or resources required to develop the assets.

The process also revealed uneven investor appetite.

Thirteen of the 50 blocks offered failed to attract commercial bids and will be returned to the government’s licensing basket.

Three of the four blocks marketed in the Chad Basin received no bids, while two blocks each in the Benue and Benin basins were also left without competing offers.

Six blocks in the Niger Delta similarly failed to attract bidders, raising questions about the commercial appeal of some assets despite assurances from regulators that investor confidence in Nigeria’s upstream sector has improved.

Among the blocks that reportedly attracted no bids were Ayama PPL 2A52 in the Niger Delta shallow waters, alongside Foniwetoiro PPL 2A37, Olori PPL 2A36, Misty PPL 2A35, Kenam PPL 2A34 and Ikuru PPL 2A31.

Other unbid assets included PPL 309, PPL 307, PPL 802, PPL 803, PPL 701, PPL 702 and PPL 703 across the country’s inland basins.

Rather than forcing unsuccessful assets into a contest without genuine competition, the blocks were left unallocated. The decision provided one of the clearest visible indications that the licensing process was not simply designed to ensure that every asset found a buyer.

The bigger test, however, concerned the 37 blocks that attracted bids and the methodology used to determine the winners.

The NUPRC said the process was designed to minimise human interference through an automated weighted scoring system.

Technical evaluations had already been completed before the commercial bids were publicly opened, while officials said no member of the evaluation team had access to the financial offers beforehand.

The commission explained that bidders were first assessed on technical competence, organisational capacity, proposed work programmes, project implementation schedules and financial capability.

Signature bonuses formed only part of the overall assessment.

“Nobody has seen the commercial bids. Everybody will see them here. Except the companies that submitted their own bids. If there is a tie, the tied bidders will be invited to resubmit using only the signature bonus as the determining parameter,” the commission said.

According to the regulator, the weighted scoring system was automated, with computers calculating the results rather than officials manually entering or adjusting scores.

Once a commercial bid was uploaded, the system generated the technical score, commercial score, aggregate score, preferred bidder and four reserve bidders.

Companies were invited alphabetically on an asset-by-asset basis, while firms bidding for the same block witnessed their respective commercial offers being opened simultaneously.

The process ended with representatives of the Federal Ministry of Petroleum Resources, the Federal Ministry of Finance, the Nigeria Extractive Industries Transparency Initiative, accredited bidders and a designated member of the public signing authentication documents for the winning bids.

The commission said 31 companies emerged successful after 143 companies submitted approximately 200 bids for 37 of the 50 assets.

The largely indigenous character of the successful bidders was among the most striking features of the round.

Publicly available information and reports from the exercise indicated that most winners were Nigerian-owned or Nigeria-based companies, while established international oil majors such as Shell, TotalEnergies, ExxonMobil, Eni and Equinor did not feature prominently among the final winners.

That outcome has intensified debate over whether the successful companies have the technical and financial capacity to turn licences into producing assets.

An official of one successful company, who spoke anonymously because he was not authorised to comment publicly, praised the NUPRC for the organisation of the auction but argued that the process should become entirely electronic.

“The use of weighted average for scoring bidders was just introduced. It wasn’t there before. We don’t have a choice. The system can even be manipulated to suit preferred bidders because people are still behind it.

But in my view, the commission performed very well in organisation and execution,” the official said.

His comments capture the central tension surrounding the exercise. The process may have been conducted openly, but openness alone does not necessarily settle questions about how the final scores were produced.

The company representative argued that removing every manual stage would further strengthen confidence in future licensing rounds.

The auction also imposed a limit on participation, with companies reportedly restricted to bidding for a maximum of two assets. The measure was intended to broaden participation across the industry but did not prevent intense competition.

Companies reportedly committed an additional $23.8m in signature bonuses to resolve ties and secure winning or reserve-bidder positions.

Professor Dayo Ayoade, an energy expert at the University of Lagos, said the licensing round broadly complied with the competitive principles introduced by the Petroleum Industry Act, particularly in moving away from discretionary allocation.

He said the process included advance publication of qualification requirements, the use of a digital licensing platform and assessments of technical and financial capacity, as well as environmental commitments.

However, Ayoade said transparency should extend beyond the public opening of bids to the decision-making process itself.

“The concluded 2025 licensing round met some of the rules that the Petroleum Industry Act 2021 put in place. We now have competitive bids as opposed to discretionary allocation,” he said.

“But where the problem may lie is that substantial transparency might be questioned. We have transparency in the process but not so much on the decision-making end. That is the valuation criteria and how it was weighted.”

Ayoade called for the publication of evaluation reports and post-bid scores to allow independent observers to understand why particular companies emerged ahead of others.

He also urged NEITI to examine both the procedures and outcomes of the licensing exercise.

The professor warned that the emergence of relatively unknown companies ahead of established industry players could revive concerns associated with the former Department of Petroleum Resources era, when discretionary allocation was a recurring criticism.

“When unknown companies are selected above established players, there is a danger or spectre that the bad old days of the DPR, where discretion played a role, may be returning,” Ayoade said.

“It is very important for the regulator to avoid transparency washing, meaning using the image of transparency to justify actions that might not be transparent.”

For Ayoade, transparency must be demonstrable rather than simply declared.

He argued that the true measure of the licensing round would not be the number of companies that won assets, but whether those companies could finance, develop and operate them effectively.

“Having more companies is not about the number of companies. It is about the seriousness of the companies. It is about the record of the companies. Do they have the capacity to do the work?” he said.

The debate over capacity is particularly important because awarding a licence is only the beginning of a long investment cycle.

Ayoade said Nigeria’s ambition to increase crude oil production to three million barrels per day could not be achieved through licensing rounds alone.

The country has experienced years of underinvestment and production challenges, while newly awarded blocks could take years before contributing significantly to national output.

“The journey to reach three million barrels per day is going to be long. We have had many years of stagnation,” he said.

“Immediate needs are what we need because licensing rounds are fine, but some of these will not result in fields. Some of the fields will only come into play maybe 10 years down the line.”

Rather than focusing exclusively on new assets, Ayoade said the government should also seek ways to revive abandoned or underperforming fields.

He suggested incentives for operators to return to assets where production had become commercially unattractive, as well as the reallocation of marginal fields to companies with proven technical and financial capacity.

Another major issue, according to Ayoade, is beneficial ownership.

He said the identities of the ultimate owners of newly awarded assets must be clear to prevent licences from being held through proxies or politically connected individuals.

“It is always going to be a problem when we issue fields to unknown entities.

That’s why the beneficial ownership provisions must come into play after the licensing rounds. Who are the true owners of these fields?” he asked.

A second energy expert, who participated in the bidding process but requested anonymity, described the round as a positive development that could contribute to Nigeria’s production ambitions.

However, the expert also questioned the transparency of the process and the size of some signature bonuses.

“My company got one block, but the signature bonus is too much. However, I think overall, it is a good exercise,” the participant said.

The expert welcomed the decision to expand exploration into inland basins, including the Benue Trough, but warned that security challenges could complicate operations in some areas.

“If you look at the process from the face value, it is good.

We are moving and that will help Nigeria to achieve the three million barrels per day target. But the question is whether the process and procedures for all those things are transparent, open and credible,” the expert said.

The participant also stressed that securing a government licence was only the first hurdle for successful bidders.

Operators must still contend with security risks, host community relations, financing requirements and the technical challenges of developing assets in less-established oil-producing areas.

The comments point to a broader reality facing Nigeria’s upstream sector. A successful licensing round can open the door to new investment, but it cannot guarantee that exploration will lead to commercial discoveries or that discoveries will quickly translate into production.

The process is therefore likely to be judged not only by the 31 companies that emerged as winners, but by what those companies do next.

For the government, the stakes are considerable. Nigeria needs new investment to reverse years of production decline, improve energy revenues and strengthen its position in the global oil market.

For investors, however, predictability, security, transparent regulation and commercial viability remain critical.

The 2025 round has demonstrated that Nigeria can conduct a competitive oil licensing exercise in public view and on a more regular basis.

Yet the questions raised by experts and industry participants suggest that the next stage of reform will require greater disclosure of evaluation results, stronger verification of beneficial ownership and clear evidence that successful bidders possess the capacity to develop the assets they have won.

With President Bola Tinubu already approving another licensing round for 2026, the NUPRC has an opportunity to build on the strengths of the latest exercise while addressing the concerns that emerged from it.

The real measure of success, ultimately, will not be how smoothly the next seven-hour auction runs.

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It will be whether the process produces credible operators, attracts meaningful investment and turns Nigeria’s long-promised petroleum potential into actual barrels, jobs and sustainable public revenue.