Divestment: Reps applaud NUPRC over issuance of decommissioning, probe compliance by IOCs

The House of Representatives on Wednesday resolved to investigate ongoing assets divestment by international oil companies operating in the Niger Delta region of the country.

This is to ascertain the level of compliance with the decommissioning and abandonment guidelines of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as enshrined in the Petroleum Industry Act, 2021.

The resolution was passed sequel to the adoption of a motion sponsored by the Chairman, House Committee on Petroleum Resources (Downstream), Honourable Ikenga Ugochinyere, who solicited for the House intervention.

In his lead debate, Ugochinyere said there is need to ensure International Oil Companies involved in the divestment of assets in the Niger Delta Region of Nigeria comply with the decommissioning, abandonment regulations and guidelines of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as enshrined in the Petroleum Industry Act (PIA

Ugochinyere said, “The House notes that the National Assembly is saddled with the task of making laws for the peace, order, and good governance of the Federation or any part thereof as enshrined in Section 4(2) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended).

“The House also notes that Sections 88(1) and (2) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), empower the National Assembly to conduct investigations into the activities of any authority executing or administering laws made by the National Assembly.

“The House is cognisant that Section 232 of the Petroleum Industry Act 2021 provides that the decommissioning and abandonment of petroleum wells, installations, structures, utilities, plants, and pipelines for petroleum operations on land and offshore shall be conducted in accordance with good international petroleum industry practice and guidelines issued by the commission or authority.

“The House is also cognisant that in the exercise of the powers conferred on it by Section 232(1)(b) of the Petroleum Industry Act, 2021, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) issued the Nigerian Upstream Decommissioning and Abandonment Regulations, 2023, which, among other things, provided certain guidelines to be followed when carrying out offshore decommissioning operations.”

Ugochinyere applauded the guidelines put in place by the NUPRC for the decommissioning and abandonment procedures.

He, however, said that “most of the international oil companies involved in petrol operations in the country are closing up their petroleum operations in Nigeria and relocating out of the country, without clearly following or complying with the decommissioning and abandonment guidelines as prescribed by NUPRC and enshrined in the PIA.

“The House is also aware that most of the international oil companies are divesting their company assets in Nigeria and relocating out of the country, without clearly following or complying with the decommissioning and abandonment guidelines as prescribed by NUPRC and as enshrined in the PIA.

“The House is concerned that as a result of the exploration and other activities of the international oil companies in the Niger Delta, the region has suffered great environmental degradation for years, with farmlands and water bodies being destroyed, leaving the communities’ ecosystems completely milked and irreparably exploited.

“The House is worried that if consent is given for the divestment of the assets of the international oil companies (IOCs) without ensuring their compliance with the guidelines and regulations put in place, the host communities will suffer irredeemably, and the companies taking over the assets of the IOCs will not be able to remedy the degradation.”

To this end, the House urged the Minister of Petroleum Resources (Oil) and NUPRC Chief Executive Officer to refrain from granting consent to divesting international oil companies (IOCs) until there is full compliance with the Guidelines for Decommissioning, as well as the Regulations made pursuant to the Petroleum Industry Act (PIA).

The House therefore, mandated the joint Committees on Petroleum Resources (Downstream), Petroleum Resources (Midstream), Host Communities, Gas Resources, Petroleum Resources (Upstream) and Environment to investigate the level of compliance with the Decommissioning and Abandonment Guidelines of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as enshrined in the Petroleum Industry Act, 2021, and report back to the House within four weeks for further legislative action.

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