NNPC Limited announced on Monday that it has signed a significant agreement with Chevron Nigeria Ltd (CNL) to convert five of their Joint Venture (JV) assets to comply with Petroleum Industry Act (PIA) terms. This deal aims to boost crude oil production, with a target of reaching 165,000 barrels per day (bpd) by the end of 2024.
According to a statement from Chief Corporate Communications Officer Mr. Olufemi Soneye, this agreement aligns with the provisions of the PIA 2021, which mandates the transition of assets from the Petroleum Profit Tax (PPT) to PIA terms. Under the new PIA regime, existing Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) will automatically convert to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) upon expiration.
Soneye noted, “An option for voluntary conversion is available for holders of OPLs and OMLs under the old PPT regime. The PIA terms are seen as more investor-friendly compared to the previous PPTA terms.”
During a ceremony at the NNPC Towers, the two companies signed documents to convert five OMLs into four PPLs and twenty-six PMLs, a move expected to enhance domestic gas supply and expand their global market presence.
Group CEO of NNPC Ltd, Mr. Mele Kyari, praised Chevron as a reliable partner. “Chevron has consistently been a partner of choice, committed to not exiting shallow water production, and we are proud of their dedication,” Kyari said.
He assured Chevron of NNPC Ltd’s commitment to sustaining the partnership to create more value for both parties and enhance Nigeria’s position in the domestic and export gas markets.
Kyari also commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its role in facilitating the conversion process.
Mrs. Michelle Pflueger, Director of Deepwater and Production Sharing Contracts at CNL, highlighted the importance of the conversion for both companies and reiterated CNL’s long-term commitment to the assets.
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