Numerous oil blocks managed by international and local oil companies under Production Sharing Contracts (PSC) with the Nigerian National Petroleum Company Limited (NNPC) remained non-producing or inactive, according to the latest Oil and Gas Industry Report for 2021 released by the Nigeria Extractive Industries Transparency Initiative (NEITI).

Out of the 23 PSC blocks in question, 12 were productive, while 17 failed to produce any crude during the review period. Additionally, there were six inactive blocks.

This situation raises concerns, as PSC arrangements are intended to contribute to Nigeria’s oil production and revenue.

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Some of the contractors involved in these non-producing or inactive PSC blocks include well-known entities such as Esso E&P, Nigerian Agip Exploration, Shell Nigeria Exploration and Production Company, Texaco Nigeria Outer Shelf Limited, Star Deep Water Petroleum Limited, Statoil Nigeria Limited, and others.

NEITI has recommended that both the Nigeria Upstream Petroleum Regulatory Commission and NNPC Ltd should promptly address the technical, operational, and other constraints that hinder production in these idle PSC blocks to optimize production under the PSC arrangements.

If these issues cannot be resolved, they suggest considering license revocation and allocation to other interested parties.