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Shell, Chevron oil licenses renewed by June | Renewal Comes before PIB

By on May 23, 2012

Nigeria expects to renew onshore oil licenses with U.S. firm Chevron and Royal Dutch Shell by June, its oil minister said on Tuesday, following Exxon Mobil’s renewal in February worth trillions of dollars.

Shell, the biggest operator in Nigeria, has onshore assets that can produce 1 million barrels of crude oil per day. It is partnered in these projects by Nigeria’s state-oil firm NNPC, Italy’s Eni and France’s Total.

“In order to show our commitment to a vibrant upstream sector … we have started the renewal of leases in good faith … renewals with Chevron and Shell are expected to be concluded by June at the latest,” Diezani Alison-Madueke said in the capital Abuja yesterday.

Several onshore drilling licenses that expired as far back as 2008 have been in negotiations between foreign oil majors, Nigeria’s state-oil firm and government for years.

Exxon signed 20-year oil license renewals on Nigerian assets producing around 550,000 barrels per day in February.

The Nigerian government has been reluctant to sign new deals or renew old ones until the Petroleum Industry Bill (PIB), which is likely to increase royalties and taxes, becomes law.

But the bill has been stuck in the assembly for years and has been subject to numerous delays and amendments, with no sign it could be passed soon, leaving major regulatory uncertainties.