The Federal Government has announced a sharp reduction in signature bonuses for the 2025 oil block licensing round, lowering entry costs to between $3 million and $7 million in a bid to attract more investors and stimulate competition.

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) confirmed the move on Monday, noting that all bidders must submit offers within the approved range. The new structure marks a significant departure from previous rounds, where bonuses reached as high as $200 million, and even last year’s $10 million benchmark.

A total of 50 blocks are on offer, spanning onshore, shallow water, deep offshore, and frontier basins. Under the revised framework, deepwater and frontier blocks carry a maximum bonus of $7 million, while shallow water and onshore blocks are capped at $3 million. Payments must be made in U.S. dollars, with successful bidders receiving Petroleum Prospecting Licences valid for three years plus a three-year renewal in onshore and shallow water areas, and five years plus five in deepwater and frontier zones.

The licensing process will follow two stages: pre-qualification and technical/commercial bid submission, restricted to shortlisted applicants. Each bidder, whether individual or consortium, is limited to a maximum of two blocks, with indirect ownership or management links counted toward the cap.

NUPRC Chief Executive Gbenga Komolafe explained that the reduction was informed by benchmarking against global practices, including Brazil, and reflects Nigeria’s need to balance competitiveness with the realities of the energy transition. The government hopes the lower entry barrier will boost reserves, increase production, and strengthen investor confidence at a time when global oil markets face mounting pressures.