1.0 Introduction
The Federal Government, Nigerian National Petroleum Company Limited (NNPC Limited), New Nigeria Development Company (NNDC) owned by the 19 northern states, Africa Oilfield Movers Limited (AOML), and Sterling Global Oil Exploration & Energy Production Company (SEEPCO) the asset operator, jointly committed over $3 billion In November 2022, towards establishing an ambitious oil exploration initiative at Kolmani, located along the Bauchi-Gombe corridor.
Despite this progress, the suspension of activities at the Kolmani oil field and the relocation of equipment raised widespread concerns about the project’s future. However, the NNPC Limited (the country’s flagship state-owned oil and gas enterprise), is making a strategic return to Nigeria’s frontier oil basins, with renewed focus on the Kolmani Oil Acreage. This marks a significant policy reversal, as operations at the site were suspended over two years ago.
NNPCL’s renewed interest in the Kolmani venture is being driven by the new Group Chief Executive Officer (GCEO), Engr. Bashir Bayo Ojulari (BBO), as part of a broader strategy to boost hydrocarbon output, generate employment, and increase national revenue through the expansion of oil and gas activities in frontier basins. Frontier basins are geologic formations with proven oil potential but where exploration has mostly been at the reconnaissance level, leaving significant quantities of hydrocarbons still untapped.
The Kolmani Frontier Basin, located in Northeast Nigeria, has attracted considerable attention for its hydrocarbon prospects. Under the leadership of the new GCEO, NNPCL is set to resume crude oil and gas drilling operations in the Kolmani field, while also working to complete the Ajaokuta–Kaduna–Kano (AKK) gas pipeline project that will catalyze in national economic growth.
In pursuit of this vision, President Bola Ahmed Tinubu was recently approached to grant the regulatory approvals necessary for recommencing operations at Kolmani, to stimulate economic development. The approvals granted by the President represent a bold and strategic effort to unlock Nigeria’s untapped hydrocarbon assets in the northern region. It reflects his commitment to escalate frontier oil exploration and attract significant investment that will revive northern oil prospects.
With these, the multibillion-dollar fully integrated Kolmani energy hub project is set to become Nigeria’s first fully integrated oil development in the North, encompassing upstream oil production, refining, gas processing, power generation, and fertilizer manufacturing. The initiative of contacting the President on the Kolmani Comeback by the new NNPC’s GCEO, who reignited Nigerian Upstream Petroleum Regulatory Commission (NUPRC), underscores a broader objective of diversifying Nigeria’s resource base beyond the Niger Delta region.
This review article highlights the resumption of activities at the Kolmani oil field, with a focus on its Integrated Development Project, which includes upstream production, a refinery, fertilizer and gas processing plants, and power generation facilities. It also provides background on the strategic importance of the project in elevating the national oil and gas sector, while noting the recent inactivity that had raised concerns among local communities.
These concerns are being addressed now by the assertive resumption of exploration and exploitation drive at the Kolmani Oil Field and the renewed push for hydrocarbon exploration in Nigeria’s Frontier Basins. These reignites a renewed national commitment to exploration, investment, and inclusive economic growth to maximize Nigeria’s untapped hydrocarbon potential.
2.0 Background of the Kolmani Oil and Gas Project
The Kolmani oil and gas field is located in the Upper Benue Trough, within the Gongola Basin, straddling the boundary between Gombe and Bauchi States in Northeast Nigeria. It became Nigeria’s first commercial oil discovery in the northern region when significant quantities of crude oil, natural gas, and condensates were confirmed in the Kolmani River-2 well.
This milestone was achieved in 2019 by Nigerian Exploration and Production Limited (NEPL), a subsidiary of NNPC Limited, created during the restructuring of NNPC to function as a fully commercial entity. It is responsible for exploration and production activities previously carried out by NNPC as a regulator and operator. NEPL now holds NNPC’s upstream oil and gas interests, including joint ventures, production sharing contracts (PSCs), and sole risk assets. With these, NEPL ensures that NNPC Limited retains a strong presence in upstream operations, now operating under commercial terms and governance.
The NEPL of NNPC Ltd is the operator handling the Kolmani development. It had so far explored and drilled two blocks with Oil Prospecting Leases (OPLs) 809 and 810, in partnership with the NNDC. This makes Kolmani Nigeria’s first confirmed inland oil discovery outside the Niger Delta, primarily containing gas and condensate, with indications of liquid oil across Kolmani River-1 and Kolmani River-2 wells, in the northern region.
In evaluating the viability and best development strategy for the Kolmani oil/gas field, Front-End Studies (FES) of conceptual design, feasibility assessments, risk analysis, and cost estimation were undertaken. This plays a critical role in ensuring that proposed development plans are technically sound and economically justifiable before the full-scale development of the field. FES used to be a standalone unit within NNPC but now operates under NNPCL Enserv, the engineering and technical services subsidiary of NNPC Limited.
Overall, the Kolmani field is estimated to contain approximately one billion barrels of crude oil and about 500 billion cubic feet of natural gas within the licensed areas. This substantial reserve positions Kolmani as a flagship project for diversifying Nigeria’s hydrocarbon production beyond the traditional Niger Delta region, with NNPC Limited as the concessionaire of OPLs 809 and 810.
A concessionaire is an individual, company, or entity that has been granted the legal right by the government to explore, develop, and produce oil and gas within a designated oil block. In Nigeria, companies such as Shell, ExxonMobil, and NNPC Limited operate as concessionaires in various oil fields, either independently or through joint ventures.
Although the concessionaire enjoys exclusive operational rights within the specified area, ownership of the underlying resources typically remains with the state. The concessionaire assumes the financial risk and responsibility for exploration and production, while also bearing the cost of investment. In return, the entity is required to pay royalties, taxes, and other statutory obligations, and retains the remaining share of the produced oil.
The concession agreement defines the legal and operational framework for the project, including its duration, financial terms, and the responsibilities of the concessionaire regarding exploration, drilling, and production activities. Unlike concession agreements, Production Sharing Contracts (PSCs) involve a different fiscal regime, where profits from oil production are shared between the state and the company after cost recovery.
After this stage, NNPCL (the appointed Kolmani concessionaire) has come up with an acceptable Field Development Plan (FDP). An acceptable Field Development Plan (FDP) is a comprehensive document submitted by a concessionaire to the regulator (formerly DPR, now NUPRC), detailing how an oil or gas field will be developed and managed. It includes reservoir data, production strategy, well design, infrastructure, environmental considerations, and economic projections.
The FDP presented by the NNPC Limited proposed an integrated development plan to ensure efficient and synergistic resource utilization in the Kolmani field. The FDP must be reviewed and approved by the NUPRC before field development can proceed. It is critical for obtaining the necessary licenses and is a key determinant of whether a project will proceed to execution. This has since been reviewed and recommended to the President and Minister of Petroleum for approval by the NUPRC.
The Kolmani Integrated Development Project was proposed to mitigate the logistical challenge of transporting crude oil from Kolmani to Nigeria’s export terminals that are located along the Atlantic coast. The plan encompasses upstream oil production, a 120,000-barrel-per-day refinery, a gas processing facility, a 300-megawatt (MW) power plant, and a fertilizer plant with a production capacity of 2,500 tonnes per day.
After initial progress in exploration and appraisal efforts by various stakeholders, activity at the Kolmani site waned due to fluctuating oil prices, security challenges, and technical setbacks, such as ignoring the necessity for Fracture Modeling for the tight sandstone reservoir in the Kolmani discovery. Nevertheless, the Kolmani Oil Project remains Nigeria’s most ambitious inland basin prospect and a strategic hydrocarbon asset for the North.
In a recent interview with the British Broadcasting Corporation (BBC), GCEO Engr. Ojulari confirmed NNPC Limited’s plans to resume activities at Kolmani and other frontier locations, alongside other plans to complete the 614-km-long Ajaokuta–Kaduna–Kano (AKK) gas pipeline project. The AKK pipeline, originally initiated by the defunct Nigerian National Petroleum Corporation (NNPC), is designed to transport natural gas from Southern to Northern Nigeria.
He described this renewed engagement as a revitalization effort intended to restore previously dormant businesses and attract new investments to the region. The recent regulatory approvals necessary for recommencing operations at Kolmani were granted to drive regional and national economic development. The approvals were based on the favourable recommendations from NUPRC.
The planned resumption of oil drilling at Kolmani, following a two-year hiatus, marks a transformative milestone in Nigeria’s energy future. It is a critical step towards diversifying the country’s energy portfolio and strengthening national energy security. The initiative aligns with NNPCL’s broader strategy to expand oil exploration beyond the Niger Delta.
The early resumption of operations at Kolmani is, in part, attributed to the awareness and advocacy efforts of the Centre for Inland Basins Studies (CIBS), Ahmadu Bello University (ABU), Zaria (https://www.truthng.com/unlocking-nigerias-frontier-basins-the-kolmani-oil-project-saga-and-why-nigerias-first-inland-oil-project-faces-uncertainty-by-prof-u-a-danbatta/).
These CIBS ABU Zaria efforts helped shape public perception and policy focus on the potential of inland basins like Kolmani. CIBS had previously predicted an early restart of the project and emphasized its importance for attracting investments, creating jobs, and boosting local content development in host communities. The renewed activities at the Kolmani site represent a landmark development in Nigeria’s hydrocarbon exploration roadmap.
They reinforce NNPCL’s mandate to broaden the country’s oil production base and deepen exploration across all frontier basins. In the context of shifting global energy dynamics and growing calls for energy diversification, NNPCL’s assertive return to Kolmani is both timely and strategic. It reflects a recalibrated national agenda that places frontier basin development at the core of Nigeria’s long-term energy strategy.
3.0 Frontier Basins Back in the Spotlight
The exploration of hydrocarbons in Nigeria’s frontier basins has long been a subject of interest and debate. While the Niger Delta has historically been the focal point of Nigeria’s oil production, attention is now shifting toward unlocking the potential of the largely untapped frontier basins in the northern regions.
Under President Bola Ahmed Tinubu’s Renewed Hope agenda, there is a renewed drive to develop these basins as part of a broader strategy to promote regional development, diversify energy sources, and enhance national energy security. This initiative aims to activate dormant oil platforms and expand production beyond the Niger Delta, leveraging the full breadth of Nigeria’s hydrocarbon assets to drive economic prosperity.
NNPC Limited is now spearheading exploration and production efforts in these basins, notably at the Kolmani site—a move that signals a strategic shift towards tapping Nigeria’s frontier resources. This development is pivotal in Nigeria’s ongoing quest to unlock the vast energy reserves hidden beneath its underexplored terrains.
The revival of the Kolmani project transcends local significance; it represents a national strategy to probe other basins, including the Bida Basin, Sokoto Basin, Chad Basin, Benue Trough, Anambra Platform, Calabar Embankment, and even the ultra-deepwater Niger Delta, which remains unexplored.
These regions are believed to harbor significant hydrocarbon reserves due to favorable geological settings, but development has been hampered by challenging terrain, security issues, inadequate infrastructure, and technological limitations.
Overcoming these challenges requires significant investment, international collaboration, and the adoption of advanced technologies. NNPC Limited’s current focus acknowledges these realities and reflects a willingness to pursue innovative solutions. The renewed exploration drive could increase national reserves, extend field life, create jobs, attract investments, and energize economic activity in previously marginalized areas.
NNPCL’s activities at Kolmani now involve cutting-edge geological and geophysical surveys, increased drilling, and comprehensive data evaluation programs aimed at generating an optimal development plan. These efforts are expected to bolster investor confidence in frontier exploration.
The 2021 Petroleum Industry Act (PIA) underpins this drive, promoting commercially viable operations and a transparent regulatory environment. Industry observers see NNPCL’s progress at Kolmani as a potential blueprint for scaling exploration efforts across other basins.
This approach aligns with Nigeria’s goal to diversify energy sources, increase domestic participation, enable technology transfer, and build capacity. The Kolmani project thus exemplifies a renewed national commitment to explore frontier assets previously deemed economically unfeasible. This commitment is reinforced by the PIA’s establishment of the Frontier Exploration Fund (FEF), which finances exploration in underdeveloped regions, ensuring equitable development and prioritizing host community benefits.
4.0 Economic and Strategic Benefits
The Kolmani project is emerging as a model for inland oil development, in alignment with the objectives of the PIA, which seeks to establish an efficient, transparent, and investor-friendly oil and gas sector.Exploration in northern Nigeria is poised to deliver numerous benefits, including increased crude oil output, improved foreign exchange earnings, job creation, and community development.
The resumption of operations is set to catalyze both foreign and local investment, stimulate job creation, and deepen local content across the oil and gas value chain. The Kolmani development is expected to attract over $3 billion in investments, significantly enhancing Nigeria’s production capacity and spurring regional growth. The project offers the promise of economic empowerment, infrastructure development, and lasting social impact.
In a major boost, a leading international petroleum exploration and de-risking company based in Singapore has engaged the Centre for Inland Basins Studies (CIBS), ABU Zaria, to express interest in acquiring equity in the Kolmani project. This aligns with Nigeria’s broader strategy of attracting foreign investment into frontier ventures.
The Singapore-based firm, a pioneer in Accelerated Oil and Gas Exploration and Digital Field Management, employs cutting-edge technologies—integrated basin modeling, AI, and geophysical analytics—to reduce costs and minimize environmental impact. With a global presence in Finland, Malaysia, and Argentina, the firm brings over three decades of experience in optimizing exploration success and mitigating risks.
The company is prepared to enter discussions with key Nigerian stakeholders—NNPC Limited, NNDC Group, host state governments, and other license holders. A proposed Joint Venture (JV) involving NNPC Limited, NNDC Group, and the Singapore firm could catalyze frontier exploration, enhance local content, and deliver long-term economic value.
CIBS, ABU Zaria is at the center of this strategic engagement, advocating for a multi-sector collaboration to achieve national profitability and development goals. Such a JV is a testament to Nigeria’s local content ambitions becoming reality and would help retain revenues domestically while strengthening the energy sector.
NNPC Limited offers deep local knowledge and operational experience, while the Singaporean firm brings innovation and global best practices. CIBS affirms its readiness to facilitate this partnership and support its implementation.
5.0 Environmental Safety and Sustainability Aspects
Sustainable development in the petroleum sector requires a balanced approach that leveraging resource extraction while safeguarding the environment and fostering community engagement. Responsible exploration in the frontier basins must prioritize ecological preservation, community welfare, and long-term economic benefits.
Oil development without sustainability often results in host community neglect. Therefore, environmental awareness and strict adherence to sustainable practices must guide operations in Kolmani and similar basins. Key to this is investment in educational infrastructure and skills development.
To this end, the Bauchi State Government has launched the construction of the Bauchi Oil and Gas Academy, Alkaleri (BOGAA), to bridge skills gaps in petroleum engineering and ensure best practices in resource management. The Academy will provide technical training critical to sustainable oil and gas development.
Complementing this initiative is the state’s 2025 investment in infrastructure (roads and bridges), to improve access to remote areas and facilitate Kolmani exploration logistics. These projects underscore Bauchi State’s commitment to becoming a vital node in Nigeria’s oil value chain.
To mitigate conflict risks associated with oil exploitation, stakeholders must adopt strong Corporate Social Responsibility (CSR) frameworks, learning from the Niger Delta experience. Community trust, environmental management, and inclusive development must be prioritized. Diversification into renewable energy is another pillar of sustainability. A balanced energy mix will safeguard the economy from volatile oil prices and support climate-resilient development.
6.0 Conclusion and Recommendations
NNPC Limited deserves commendation for its strategic leadership in driving frontier basin exploration. Its renewed activities in Kolmani reflect Nigeria’s broader commitment to economic diversification and energy security under the Renewed Hope agenda.
This momentum must be shielded from political distractions that could derail progress, and President Tinubu’s timely approvals of Kolmani licenses have already yielded tangible results. CIBS ABU Zaria is proud to play a role in these transformative developments of redefining Nigeria’s energy geography to reflect a comprehensive development vision.
The success of the Kolmani project can serve as a template for unlocking Nigeria’s other frontier basins. It positions Nigeria to meet growing energy demands and reduce reliance on mature fields in the Niger Delta. By prioritizing untapped basins in the North, the government aims to promote inclusive regional development and solidify national energy independence.
To ensure success, implementation of the Kolmani project must adhere to the following recommended international best practices and prioritize:
- i) Responsible exploration and environmental stewardship, aligned with evolving global decarbonization goals and environmental sustainability imperatives.
- ii) Effective communication and transparency from NNPC Limited and regulators such as NUPRC.
iii) Full compliance with the PIA and other regulatory frameworks, and inclusive stakeholder engagement and sustainable community development.
Unlocking the Kolmani potential is not just a story of exploration and exploitation of Kolmani’s estimated oil and gas reserves from CIBS ABU Zaria. It is a national development milestone, with far-reaching implications for energy security, regional equity, and Nigeria’s future prosperity, which includes drilling multiple wells, are key components of this potential transformation.
Prof. U. A. Danbatta is the Director of the NNPCL-funded Centre for Inland Basins Studies (CIBS), Phase II Site, Ahmadu Bello University, Zaria, Nigeria. He can be reached at +2348037016754; uabatta@gmail.com; and/or uadanbatta@abu.edu.ng.
