A source from Nigerian National Petroleum Corporation (NNPC) said last week that Nigeria is making progress towards resolving a dispute with Exxon Mobil over oil licensing renewals covering fields producing more than 500,000 barrels per day.
Exxon said last week it signed agreements in 2009 with the Nigerian government for the long-term renewal of licenses OML 67, 68 and 70, which it operates as part of a joint venture with NNPC.
The government has said these licenses are invalid and Exxon needs to express a new interest in acquiring leases for these valuable oil blocks. An NNPC spokesman said the oil major had now done this. “We are on track,” the spokesman told newsmen when asked about resolving the dispute.
The disputed blocks are situated in the shallow water creeks of the Niger Delta and are some of the largest oil-producing assets in Nigeria.
Delays to wide-ranging energy reforms mean several expired drilling licenses dating back as far as 2008 have not been renewed with foreign oil companies, including Royal Dutch Shell and Chevron.
The government has been reluctant to sign new deals until the Petroleum Industry Bill (PIB), which is likely to increase royalties and taxes, has been passed into law.
But the ambitious legislation has been subject to years of delays, costing the government billions of dollars in lost investment, according to oil executives.
The National Assembly is debating the bill, but the current parliamentary administration ends on June 3. If the PIB is not passed by then, new lawmakers may make amendments that could lead to months of further delays.
The government hopes the bill will tackle issues including funding shortfalls at its joint ventures with foreign firms, insecurity in the Niger Delta, increasing local involvement in the industry and production of more gas for domestic power.