The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has expressed support for the Federal Government’s proposed shift in oil royalty structure, describing the move as necessary to strengthen revenue generation and align with industry realities.
The commission also defended the collection of $3.7 million in signature bonuses, insisting the payments were legitimate and in line with existing regulatory frameworks governing upstream petroleum operations.
According to the NUPRC, the proposed royalty adjustment is aimed at improving efficiency in revenue collection while ensuring Nigeria remains competitive in the global oil and gas sector. The regulator noted that royalties, alongside signature bonuses and other charges, form a critical part of government earnings from the industry.
Justifying Signature Bonuses
Addressing concerns over the $3.7 million signature bonuses, the commission maintained that such payments are standard practice in the oil and gas sector, typically tied to the award of licences and leases.
Officials stressed that the bonuses were not arbitrary but derived from transparent processes, adding that they contribute significantly to government revenue streams.
The NUPRC further highlighted ongoing efforts to block leakages and ensure full remittance of revenues due to the government. It reiterated its commitment to a “zero default” approach in royalty payments as part of broader reforms in the upstream sector.
The commission explained that beyond royalties, revenue sources include gas flare penalties, concession rentals, and other statutory payments tied to petroleum operations.
The development comes amid wider reforms in Nigeria’s oil sector aimed at boosting transparency, increasing revenue, and attracting investment.
By supporting the proposed royalty shift, the NUPRC signalled alignment with federal efforts to reposition the petroleum industry for long-term sustainability while maximising returns from natural resources.
