The federal government of Nigeria has announced its intention to review, as part of its gas commercialization initiatives, the gas terms under the gas production contracts concluded between the Nigerian National Petroleum Corporation (NNPC) and gas production companies. According to the Director of the Department of Petroleum Resources (DPR), the review will focus on duration, cost of gas, tax gas, royalty gas and profit gas and is expected to be included in the Petroleum Industry Bill, which has been submitted to the National Assembly.
The review is also expected to be included in the production sharing contracts (PSCs) concluded between the NNPC and international oil companies (IOCs), providing clarity on the fiscal terms. The Deep Offshore and Inland Basin Production Sharing Contract Act, Cap. D3, LFN 2004, which was amended in 2019, provides statutory backing to the PSCs between the NNPC and IOCs.
Further developments will be reported in due course.