Reps decry non-compliance with PIA on oil asset decommissioning
The House of Representatives Ad hoc Committee on Decommissioning and Abandonment has faulted the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) over alleged non compliance with provisions of the Petroleum Industry Act (PIA).
The committee said poor enforcement of the law has continued to hinder proper decommissioning and abandonment of oil and gas assets in the country.
The allegation was made at a resumed investigative hearing of the committee at the National Assembly following submissions by officials of the two agencies.
The Chief Executive Officer of NUPRC, Engr. Farouk Ahmed was represented by the Executive Commissioner for Development and Production Engineering, Engr. Enorense Amadasu.
Similarly, the Chief Executive Officer of NMDPRA, Engr. Gbenga Komolafe, was represented by the Executive Director of Health, Safety, Environment and Communities, Dr. Mustafa Lamorde.
The House had set up the committee to investigate operators’ and regulators’ compliance with the PIA on decommissioning and abandonment of oil and gas facilities.
The probe was triggered by concerns over an estimated $20 billion funding gap and the environmental and fiscal risks posed by ageing oil and gas assets.
Lawmakers are also examining operators’ decommissioning plans, escrow account arrangements and regulatory enforcement to protect host communities and the environment from abandoned infrastructure.
In their submissions, NUPRC and NMDPRA officials attributed delays in implementing the PIA provisions to legal issues at the Ministry of Justice, escrow account challenges and the role of the Central Bank of Nigeria.
Amadasu said NUPRC had enforced Sections 232 and 233 of the PIA 2021, which require operators to submit decommissioning and abandonment plans.
He said every field development plan approved by the commission now includes provisions for decommissioning at the end of the asset’s life cycle.
Chairman of the committee, Hon. Bassey Ekpenyong, expressed dissatisfaction with the slow pace of implementation of the law.
He recalled that the decommissioning and abandonment regulation was approved in 2003 and warned that continued delays expose Nigeria to serious environmental and financial risks.
