The House of Representatives Ad-hoc Committee on Decommissioning and Abandonment in the oil and gas sector has accused the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of failing to comply with key provisions of the Petroleum Industry Act (PIA) and other relevant laws, an issue the committee said is undermining effective regulation.

The committee raised the concern after receiving submissions from officials of both regulatory agencies during its resumed investigative hearing at the National Assembly.

Both agencies were represented by senior officials who appeared on behalf of their Chief Executive Officers (CEOs), armed with official letters delegating their authority.

NUPRC Chief Executive, Engr. Farouk Ahmed, was represented by the Executive Commissioner for Development and Production Engineering, Engr. Enorense Amadasu, while NMDPRA CEO, Engr. Gbenga Komolafe, was represented by the Executive Director, Health, Safety, Environment and Communities, Dr. Mustafa Lamorde.

The House had set up the ad-hoc committee to examine the level of compliance by operators and regulators with PIA requirements for decommissioning and abandonment (D&A) of oil and gas assets. The investigation was prompted by concerns over a staggering $20 billion funding gap and the growing environmental and fiscal risks posed by aging infrastructure across the sector.

Part of the probe focuses on companies’ D&A plans, escrow funding arrangements, and enforcement actions by regulators, all aimed at preventing communities and the environment from inheriting liabilities from abandoned facilities.

In their separate presentations, NUPRC and NMDPRA acknowledged that multiple challenges have slowed down implementation of D&A regulations despite clear provisions in the PIA.

The agencies cited unresolved legal issues at the Ministry of Justice, compliance requirements involving the Central Bank of Nigeria (CBN), escrow account arrangements, and other procedural hurdles.

Providing clarification, the NUPRC representative, Engr. Amadasu, said the Commission has continued to enforce Sections 232 and 233 of the PIA and has held extensive engagements with industry operators to strengthen compliance.

He explained: “The NUPRC has consistently enforced the relevant provisions of the PIA relating to decommissioning and abandonment. Every field development plan submitted to the Commission is now accompanied by a decommissioning and abandonment plan. These plans outline what happens at the end of an asset’s life cycle and ensure that the environment is restored as close as possible to its original condition.”

Committee Chairman, Hon. Bassey Ekpenyong, expressed dissatisfaction over the slow pace of regulatory implementation, noting that the delays are inconsistent with both the PIA and older existing regulations.

“The regulation was approved in 2003, and I believe it was submitted to the Minister of Justice thereafter. These delays in full implementation are unacceptable,” he said. (Daily Independent)

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