KEY POINTS
- TotalEnergies awarded two offshore blocks in Nigeria, the first IOCs to secure acreage via bid round in over a decade.
- Blocks PPL 2000 and 2001 span 2,000 km² in the West Delta basin; drilling of at least one exploration well is planned.
- Move signals Nigeria’s push to lure back foreign investment after years of declining upstream activity.
The first time an international oil company has obtained acreage through a competitive bid round in Africa’s largest crude producer in over a decade, French energy giant TotalEnergies has secured two new exploration blocks off the coast of Nigeria.
The company said in a statement on Tuesday that it had signed production-sharing agreements for permits PPL 2000 and PPL 2001 with its local partner, South Atlantic Petroleum. South Atlantic Petroleum owns the remaining 20% of the business, while TotalEnergies owns 80%.
The blocks are located in the West Delta basin, a fertile area that has yielded some of Nigeria’s biggest oil and gas discoveries. They span about 2,000 square kilometers.
Drilling at least one exploration well is part of the immediate work program, indicating that the French major plans to move swiftly on the acreage.
Kevin McLachlan, TotalEnergies’ head of exploration, framed the award as a milestone in both the company’s relationship with Nigeria and in reviving foreign interest in the country’s oil patch. “These promising block captures are fully aligned with our strategy of strengthening our portfolio with drill-ready, high-impact prospects,” he said.
Nigeria Seeks to Rekindle Foreign Investment
There is more to the signing than just another upstream agreement. It occurs at a time when Abuja is working hard to draw new investment into its oil and gas industry following years of dwindling investment, deteriorating infrastructure, and protracted regulatory processes.
Following a decade in which local independents dominated new acreage awards, the Nigerian Upstream Petroleum Regulatory Commission organized the 2024 licensing round with the goal of reintroducing international players.
The agreement strengthens TotalEnergies’ already substantial presence in Nigeria, where it has operated for more than 60 years.
Nigeria was one of its top hydrocarbon contributors in 2024, with the company producing an average of 209,000 barrels of oil equivalent per day from the West African country. It has long established itself as a vital partner in regional economic development and operates more than 500 gas stations nationwide.
According to the company, the new permits may lead to discoveries that support “low-cost and low-emissions developments,” which would be consistent with its overarching plan to maintain high returns while reducing the carbon intensity of its holdings.
In 2024, Nigeria was one of the West African countries that contributed the most hydrocarbons to the company’s output, averaging 209,000 barrels of oil equivalent per day. Additionally, it operates over 500 gas stations nationwide and has long established itself as a vital contributor to regional economic growth.
According to the company, the new permits might lead to discoveries that support “low-cost and low-emissions developments,” which would be consistent with its overarching plan to maintain high returns while reducing the carbon intensity of its holdings.
However, industry observers point out that operators continue to face obstacles due to Nigeria’s ongoing security issues, Delta community conflicts, and frequent project delays. How quickly Abuja can provide regulatory stability and competitive fiscal terms will determine whether this award marks a long-term comeback for significant Western oil companies.
