NUPRC Rejects Proposed Oil and Gas Decommissioning Commission

NUPRC Rejects Proposed Oil and Gas Decommissioning Commission



The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has opposed a bill to establish a National Commission for Decommissioning of Oil and Gas Installations, arguing it is redundant under the Petroleum Industry Act (PIA) 2021. 

During a public hearing on Thursday, October 16, 2025, before the House of Representatives Committee on Petroleum Resources (Upstream), NUPRC Director Emmanuel Jaja stated that the PIA already provides a robust framework for managing decommissioning, abandonment, and restoration in the oil and gas sector, aligned with global standards.

Jaja argued that a new commission would duplicate NUPRC and NMDPRA functions, create bureaucratic overlap, and burden the government financially. 

He emphasized that decommissioning is an integral part of oil and gas field lifecycle management, as practiced in countries like Norway, the US, and the UK, where existing regulators oversee such activities to ensure coherence and data integrity. 

A separate agency, he warned, could undermine regulatory clarity, deter investment, and contradict the PIA’s objectives.He highlighted the PIA’s Section 233, which establishes a Decommissioning and Abandonment Fund, held in escrow for end-of-life asset management, distinct from company or government revenue. 

With the Nigerian National Petroleum Company Limited holding 60–100% equity in most joint ventures, the government already bears significant decommissioning costs, and a new commission would add unnecessary fiscal strain.

Jaja urged the committee to retain oversight within NUPRC and NMDPRA for technical coherence, economic efficiency, and alignment with global standards, supporting Nigeria’s ease of doing business initiatives.Committee Chairman Alhassan Doguwa noted that Nigeria’s petroleum industry has faced environmental, economic, and social challenges from decommissioning, particularly impacting host communities. 

He acknowledged the PIA’s provisions for decommissioning and the associated fund but stressed the need to evaluate whether existing frameworks suffice or require a dedicated body. 

Doguwa assured stakeholders that the committee would carefully assess all submissions to recommend a balanced, sustainable framework for managing decommissioning activities. 

 

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Source: Nigerianeye

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