Nigeria has shortened the time required for granting approvals needed to restart inactive oil wells, as officials aim to ramp up crude production.
Eniola Akinkuotu, the spokesperson for the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), informed TheCable that the regulator is expediting the permit process and decreasing the timelines necessary to authorize the reactivation of these dormant wells.
"We are accelerating our processes and reducing the timelines for issuing permits. Each permit has its own specific duration," he stated.
This move is designed to enable Nigeria to capitalize on soaring global energy prices and the growing demand for alternative crude sources.
A recent report from Bloomberg highlighted that the NUPRC is now able to issue permits within hours after application, relying on anonymous sources familiar with these operations.
The report mentions, "With oil prices hovering around $100 per barrel, major producers in Africa are seizing the opportunity to satisfy demand, as buyers shift their focus toward suppliers like Nigeria and Angola, distancing themselves from the ongoing Middle East conflicts."
Additionally, the West African country has expedited approvals for evacuations and barges at production sites and export terminals.
A representative of the regulator remarked that prompt approvals are granted for all activities aimed at boosting production.
Bloomberg further noted that the surge in applications is primarily attributed to local oil companies eager to return to previously inactive wells, encouraged by the regulatory body’s decision to accelerate a process that previously took between two and six weeks.
Reactivating older wells is viewed as a more economical option compared to drilling new ones, which often require extensive planning and around four weeks for crude to surface post-drilling.
The report pointed out that Nigeria’s oil production dwindled to 1.31 million barrels per day in February, marking its lowest level in 17 months, mainly due to maintenance at a production facility operated by Shell Plc that produces 225,000 barrels daily.
"Production has yet to bounce back to previous highs of over 2 million barrels per day, limiting the nation's capacity to take advantage of the rising crude prices compared to its counterparts," the publication added.
In 2022, Nigeria averaged 1.34 million barrels daily when oil prices soared to approximately $130 per barrel following Russia's invasion of Ukraine.
The regulatory body approved 500 permits in 2024 for reopening dormant wells, which included ventures from Heirs Energy and Seplat Energy Plc.
On April 1, Heineken Lokpobiri, the Minister of State for Petroleum Resources, announced that the federal government intends to initiate the 'drill or drop' provisions outlined in the Petroleum Industry Act.
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