FG to Revoke Dormant Oil Wells as Tinubu’s Govt Cracks Down

By Achimi Muktar

ABUJA—After decades of inaction, the Federal Government has issued a final warning to oil firms: Drill your oil wells or lose them!

Oil well licensees who have failed to commence drilling operations in the last 30 years now face imminent revocation of their licenses under the “Drill or Drop” provision of the Petroleum Industry Act (PIA) 2021.

This tough stance was made clear by the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, during the Cross Industry Group (CIG) Meeting in Florence, Italy, attended by major International Oil Companies (IOCs) operating in Nigeria.

No More Dormant Oil Wells—FG Takes Action

The minister didn’t mince words, warning that any responsible government would reallocate undeveloped assets to investors ready to start drilling immediately.

“We cannot continue to have assets sitting idle for 20 to 30 years without development. If you are not utilizing an asset, it neither adds value to your books nor to us as a country,” Lokpobiri declared.

He urged oil operators to embrace farm-out agreements, allowing smaller firms to take over underutilized assets, rather than wasting resources on costly new Floating Production Storage and Offloading (FPSO) units.

IOCs Put on the Spot: Invest or Get Out

In a direct challenge to oil giants, Lokpobiri called on IOCs to ramp up investments in Nigeria’s oil and gas sector, emphasizing that the Tinubu administration has already provided every necessary incentive for a seamless and profitable operation.

“The government has done its part by providing investment-friendly fiscal policies, including the President’s Executive Order incentivizing deepwater investments. Now, the ball is in the court of the IOCs,” he stated.

He also addressed concerns from oil firms about Engineering, Procurement, and Construction (EPC) contractors, arguing that EPC firms will only commit when IOCs make strong investment decisions.

Boosting Local Refining & Energy Security

The minister stressed that oil operators must support Nigeria’s refining efforts, as more refineries are set to come online and will require a steady supply of crude oil.

“Ramping up production will enable Nigeria to meet both local and international obligations,” Lokpobiri added.

Oil Industry Players Respond

Osagie Osunbor, Chairman of the Oil Producers Trade Section (OPTS), commended the Federal Government’s engagement with industry stakeholders, acknowledging the need for increased investment.

“The Minister’s engagement has provided critical insights and has also challenged us as industry players to step up efforts to increase production,” Osunbor stated.

What This Means for Nigeria

With oil theft, underinvestment, and declining production threatening Nigeria’s economy, the Federal Government’s decisive action aims to:
✅ Increase oil output
✅ Boost government revenue
✅ Strengthen energy security
✅ Attract fresh investments into the sector

The Big Question: Will Oil Firms Step Up or Will FG Seize Their Wells?

With a firm deadline in place, oil firms now face a critical decision—drill or lose their multi-billion-dollar assets.

Is this the bold move Nigeria needs to revive its struggling oil industry, or will big oil fight back? Time will tell.