Nigeria Signs Landmark Deepwater Oil Deal with TotalEnergies, Sapetro to Unlock Offshore Potential
Abuja, Nigeria — The Federal Government of Nigeria has signed a landmark Production Sharing Contract (PSC) with TotalEnergies and South Atlantic Petroleum (Sapetro), a deal expected to significantly boost deepwater oil production and unlock fresh investment in the nation’s upstream sector.
The agreement, finalized through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), covers two offshore blocks awarded in the 2024 Licensing Round—Petroleum Prospecting Licences (PPLs) 2000 and 2001—spanning a combined 2,000 square kilometres in the prolific Niger Delta Basin.
Under the terms, TotalEnergies will operate the blocks with an 80 percent stake, while Sapetro holds the remaining 20 percent. The PSC also includes a $10 million signature bonus, alongside performance-based production bonuses tied to milestones of 35 million and 100 million barrels.
At the official signing ceremony in Abuja, NUPRC Chief Executive, Gbenga Komolafe, hailed the contract as a turning point for Nigeria’s upstream industry. He credited President Bola Tinubu’s 2024 executive orders on fiscal incentives, local content, and contract timelines for making Nigeria a more competitive investment destination.
“This PSC signals the start of a committed work programme that will help us unlock the untapped geological potential of our deepwater, expand our reserves, boost production, and strengthen Nigeria’s energy security,” Komolafe said.
The PSC aligns with the Petroleum Industry Act (PIA) and provides clarity on cost recovery, profit oil sharing, royalties, host community obligations, gas utilisation, decommissioning, and environmental remediation.
Speaking at the event, NNPC Ltd. Group CEO Bayo Ojulari described the deal as the first of its kind in Nigeria’s deepwater sector under the PIA framework, noting its comprehensive coverage of both crude oil and natural gas.
“This PSC is properly framed to reflect the nuances of the PIA, with robust gas terms that incentivise monetisation of non-associated gas, a critical area for Nigeria’s future,” Ojulari said.
TotalEnergies’ Country Chair, Matthieu Bouyer, reaffirmed the company’s longstanding commitment to Nigeria, where it employs over 1,800 people and produced more than 400,000 barrels of oil equivalent per day in 2024.
“We are eager to progress swiftly and responsibly with the implementation of the agreed work programme. This agreement marks a new chapter in our partnership with Nigeria,” Bouyer noted, pledging to deliver value for both the country and its people.
The deal is widely seen as a boost for Nigeria’s ambition to achieve daily crude production of three million barrels while reinforcing its position as a premier upstream investment hub in Africa.
