KEY POINTS
- No fewer than 25 oil blocks are scheduled to expire in 2026, creating fresh tensions in Nigeria’s upstream petroleum sector.
- The expirations coincide with a landmark Executive Order signed by President Tinubu, which mandates the direct remittance of oil revenues to the Federation Account.
- Stakeholders warn that uncertainty over block renewals and potential revocations under the Petroleum Industry Act (PIA) could threaten Nigeria’s 2-million-barrel-per-day production goal.
MAIN STORY
Fresh tensions are building in Nigeria’s upstream petroleum sector as approximately 25 oil blocks are scheduled to reach the end of their tenures in 2026. According to the Nigerian Upstream Concession Situation Report for February 2026, these include a mix of Petroleum Prospecting Licences (PPLs), Oil Prospecting Licences (OPLs), and Oil Mining Leases (OMLs). Notable expirations include PEL 1 (held by TGS-Petrodata) due in April, and several PPLs held by firms like Transnational Energy and Waltersmith Petroman, which already lapsed earlier this month.
This wave of expirations comes at a critical juncture, following President Bola Tinubu’s Executive Order of February 13, 2026. The order strips the Nigerian National Petroleum Company Limited (NNPCL) of its ability to deduct management fees and Frontier Exploration Funds before remitting revenues. While the government views this as a move toward transparency that could boost the Federation Account by over ₦918 billion, energy experts like Professor Wumi Iledare caution that the order may conflict with statutory provisions of the PIA, potentially creating “investor uncertainty” just as critical blocks are up for renewal.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has already launched a 2026 licensing round offering 50 new blocks to attract $10 billion in investment. However, the fate of the 25 expiring blocks remains a point of anxiety. Under the PIA, the government has the authority to revoke licenses that fail to meet specific work programme obligations. Stakeholders are calling for clear implementation guidelines to ensure that this revenue-focused Executive Order does not inadvertently stall the very production activities needed to fund the national budget.
WHAT’S BEING SAID
- “The situation was worsened by uncertainty over renewals… which could affect output projections at a time when Nigeria is striving to boost production,” noted stakeholders in a recent industry assessment.
- Energy expert Jide Pratt stated that the Order “nips in the bud” the issue of NNPCL holding federation revenue, but warned that the company now faces a “test of its commercial mandate”.
- Professor Wumi Iledare cautioned that alterations to fiscal frameworks might require “legislative amendment to ensure constitutional alignment and investor certainty”.
WHAT’S NEXT
- The NUPRC is expected to provide clarity on whether the 25 expiring blocks will be automatically renewed or included in upcoming open bid rounds.
- The Implementation Committee, chaired by the Minister of Finance, will begin overseeing the transition of revenue flows from NNPCL directly to the Federation Account.
- National Assembly members may be called upon to review the Executive Order’s alignment with the Petroleum Industry Act of 2021.
BOTTOM LINE
The Bottom Line is that Nigeria is walking a tightrope between fiscal transparency and operational stability. While the new Executive Order promises more money for the federation, the expiration of 25 key oil blocks creates a high-stakes environment where any regulatory misstep could deter the investment needed to keep the country’s oil production afloat.
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