The Federal Government of Nigeria has lowered the signature bonus for the 2025 oil block licensing round, setting it at a minimum of $3 million and a maximum of $7 million per block, down from the $10 million required in the 2024 round. The move is aimed at reducing entry barriers for investors in the country’s upstream petroleum sector.

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) confirmed the reduction in its “FAQs on the 2025 Licensing Round,” noting that the signature bonus must be paid in U.S. dollars and submitted within the approved range.

“All bidders shall be required to submit a bid within a range of $3 million and $7 million as approved by the Minister of Petroleum for the reduction of entry barriers,” NUPRC stated.

The licensing process will follow a score-based approach, evaluating bidders on multiple parameters, including:

• Signature bonus (within prescribed limits)
• Work programme
• Unit cost per barrel in relation to the work programme
• Professionalism, human and technical capacity
• Bank guarantees, balance sheet, turnover
• Corporate governance and decarbonisation initiatives

NUPRC also set minimum financial requirements for participation:

• Deep offshore blocks: Average annual turnover or cash in bank of $100 million, or a bank/parent company guarantee of $100 million.
• Onshore and shallow water blocks: Average annual turnover or cash in bank of $40 million, or a bank/parent company guarantee of $40 million.

Bidders are limited to applying for no more than two assets across all applications, whether individually or as part of a consortium. Ownership or management involvement across multiple consortiums counts toward this limit.

Technical competence will be assessed based on expertise in: geological and geophysical capabilities, drilling and well engineering, reservoir evaluation, production engineering, development planning, and facilities engineering and management.

The reduction in signature bonus reflects the government’s ongoing efforts to encourage wider participation, attract investment, and strengthen the competitiveness of Nigeria’s oil and gas sector.