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Nigeria to hold marginal field bidding round in Q4 2011

05 Oct 2011

Nigerian newspaper 'The Punch' has announced that after several postponements by the Federal Government, the Director, Department of Petroleum Resources, Mr. Andrew Obaje, stated last Wednesday that the 2011 Marginal Field Bid Round would be held in the fourth quarter.

According to the newspaper, the bid round will entail auctioning of marginal field blocks to indigenous oil players. The exercise was to have been held in 2010, but was postponed till this year. Many indigenous marginal field operators are already getting ready to participate in the bid. Obaje said that DPR was just awaiting the approval of the Federal Government for the bid round to be held. DPR is responsible for organising oil bid rounds. The last time it was held was under former President Olusegun Obasanjo in 2007.

'We are ready to hold the marginal field bid round before the end of the year. Although, it will be for indigenous players, it will also create opportunities for foreign investors, who may want to partner the indigenous players,' Obaje is reported to have said.

The Federal Government had in August 2001 invited suitable indigenous companies to bid for the allocation of 24 marginal fields located within the Niger Delta. However, only seven out the 24 companies are currently producing crude oil. They include Energia’s Obodeti/Obodougwa field; Midwestern’s Umusadege field; Pillar Oil’s Umusati/Igboku field; Platform’s Asuokpu/Umutu field; Brittania-U’s Ajapa field; and Walter Smith’s Ibigwe field.

The newpaper further reported that the marginal field bid round was being organised with a view to increasing the production capacity of Nigeria’s indigenous players, who were barely contributing five per cent to the total Nigeria’s daily oil production of 2.4 million barrels per day.

Energia, operator of the Energia/Oando Joint Venture in Oil Mining Lease 56, has signified its intention to acquire more marginal field blocks when the next marginal field bid round is held. Managing Director of the company, Mr Amieyesori Felix, said recently that the company was waiting to participate in the next marginal field bid round as part of its growth plan.

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Source: The Punch

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