Nigeria to renegotiate fiscal terms for offshore PSCs

The timing of renegotiation of fiscal terms for offshore production-sharing contracts (PSCs) signed two decades ago is questionable for state-owned NNPC

It comes at a time of low oil prices in an industry already lacking regulatory clarity. Nigeria relies on oil for over 70% of its overall revenues and while it is keen to ensure a greater return from oil, renegotiation of contracts will not come easily. NNPC’s new group managing director Ibe Kachikwu 15 September announced a planned review of the fiscal terms of the PSCs, first signed with the major oil companies in the early 1990s, to help solve NNPC’s ability to fund its share in joint venture oil operations and to incentivise investment in frontier fields in Nigeria’s deep and ultra-deep waters. “We intend to begin the process of the re-negotiation of the PSCs to see what value chain and