Federal Government Slashes Oil Block Signature Bonus to Minimum $3 Million to Attract Investors in 2025 Licensing Round

In a bold move to revive investment and participation in the nation’s oil and gas sector, the Federal Government, through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), has drastically reduced the signature bonus required for oil blocks in the ongoing Nigeria 2025 Petroleum Licensing Round. The entry cost has been set to a minimum of $3 million and a maximum of $7 million.

The announcement, made by the NUPRC on Monday, December 8, 2025, confirms a further significant reduction from the $10 million per block charged during the 2024 bid round. The new, reduced rate is aimed at immediately lowering the barriers to entry and aligning Nigeria’s costs with global industry benchmarks, a strategic shift designed to lure both indigenous and international investors.

The NUPRC’s Chief Executive, Gbenga Komolafe, stated that the move was approved by the Minister of Petroleum Resources as part of a deliberate strategy to stimulate exploration activities and expand the nation’s reserve base. The 2025 Licensing Round offers a total of 50 oil and gas blocks across diverse terrains, including onshore, shallow water, and deep offshore. The government projects that the exercise will attract up to $10 billion in direct investment and potentially add up to two billion barrels to national reserves over the next decade.

However, the upstream regulator cautioned that the bidding process remains highly competitive, with a strict adherence to the new rules. The NUPRC explicitly warned that all bidders must submit an offer within the approved $3 million to $7 million range; any bid falling below the prescribed minimum will be automatically deemed non-compliant and disqualified from evaluation. The new signature bonus must also be paid in United States dollars, reflecting the international nature of the transaction.