NNPC Ltd and Chevron Complete Asset Conversion, Target 165,000 BOPD by December 2024.
The Nigerian National Petroleum Company Limited (NNPC Ltd) and Chevron Nigeria Limited (CNL) have finalized the conversion of their joint venture (JV) assets to align with the Petroleum Industry Act (PIA) 2021, a landmark development aimed at enhancing Nigeria’s oil and gas production capabilities. This move transitions the companies from the previous Petroleum Profit Tax (PPT) regime to the new, investor-friendly PIA terms.
Under the PIA, Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) are set to automatically convert to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) once their current terms expire. However, operators under the PPT system have the option to voluntarily convert their licenses earlier, which is what NNPC Ltd and Chevron have opted to do.
In a formal signing ceremony held at NNPC Towers on Monday, both parties concluded the conversion of five OMLs into four PPLs and 26 PMLs. This strategic move is expected to bolster domestic gas supplies and enhance Nigeria’s competitiveness in the global oil and gas sector.
Mele Kyari, Group CEO of NNPC Ltd, commended Chevron as a long-term and dependable partner, particularly in shallow water operations, while reaffirming NNPC’s commitment to the partnership. Kyari expressed optimism that this collaboration will maximize value for both companies, strengthen domestic gas supply, and support export efforts.
Kyari also extended his gratitude to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its role in facilitating the asset conversion.
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Chevron’s Director of Deepwater and Production Sharing Contracts (PSC), Michelle Pflueger, hailed the milestone as a testament to Chevron’s ongoing dedication to its JV assets in Nigeria. Similarly, NNPC’s Executive Vice President for Upstream, Oritsemeyiwa Eyesan, highlighted the advantages of the PIA, emphasizing how the new terms offer a more favorable business environment.
Chief Upstream Investment Officer at NNPC Ltd, Bala Wunti, noted that this conversion would significantly boost oil production, with both NNPC and Chevron targeting a production capacity of 165,000 barrels of oil per day (BOPD) by December 2024. He also emphasized the importance of maintaining operational stability and ensuring consistent gas supplies to meet domestic demand.
This successful conversion represents a major step forward in Nigeria’s efforts to enhance its oil production and gas supply capabilities, while offering a more attractive framework for international investors.
