The Nigerian National Petroleum Company Limited (NNPC Ltd) and Chevron Nigeria Limited (CNL) have successfully concluded the conversion of their joint venture assets into terms compliant with the Petroleum Industry Act (PIA) 2021. This move aligns with the Act’s directive, which transitions assets from the previous Petroleum Profit Tax (PPT) regime to PIA standards.
Under the PIA, Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) automatically shift to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) upon expiration, though operators under the PPT system can voluntarily convert their licenses earlier. The new PIA terms are regarded as more favorable to investors than the previous tax regime.
At a formal signing ceremony held at NNPC Towers on Monday, the two partners finalized the conversion of five OMLs into four PPLs and 26 PMLs. This conversion marks a significant step towards boosting domestic gas supplies and increasing Nigeria’s presence in the global oil and gas markets.
NNPC Ltd’s Group CEO, Mr. Mele Kyari, praised Chevron as a longstanding and reliable partner, highlighting its commitment to the joint venture, particularly in shallow water operations. Kyari affirmed NNPC’s intention to continue the partnership, aimed at maximizing value for both companies and expanding Nigeria’s gas supply domestically and for export.
He also acknowledged the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for facilitating the asset conversion.
CNL’s Director of Deepwater and Production Sharing Contracts (PSC), Mrs. Michelle Pflueger, emphasized the importance of this development, underscoring Chevron’s commitment to the JV assets. Similarly, NNPC Ltd’s Executive Vice President for Upstream, Mrs. Oritsemeyiwa Eyesan, highlighted the strategic advantages of transitioning to the PIA terms, which provide a more favorable business environment.
Chief Upstream Investment Officer at NNPC Ltd, Mr. Bala Wunti, noted that the conversion is expected to significantly enhance oil production. He added that both partners are focused on achieving a production target of 165,000 barrels of oil per day (bopd) by the end of 2024. Wunti also stressed the importance of maintaining operational stability and ensuring a steady supply of gas to meet domestic needs
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