Lokpobiri, Komolafe Fault Proposed Oil Decommissioning Commission, Cite Duplication

The Ministry of Petroleum Resources, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Nigerian National Petroleum Company Limited (NNPC) have jointly opposed a proposed bill seeking to establish the National Commission for the Decommissioning of Oil and Gas Installations (NC-DOGI), 2024.

Their opposition was presented during a public hearing organised by the House of Representatives Committee on Petroleum Resources (Upstream), where top government officials — including the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, and NUPRC Chief Executive, Engr. Gbenga Komolafe — voiced strong objections to the proposed legislation.

In a statement released in Abuja on Friday by NUPRC’s Head of Corporate Communications and Media, Eniola Akinkuotu, the commission argued that the Petroleum Industry Act (PIA) 2021 already provides a comprehensive legal framework for decommissioning and abandonment, rendering the creation of a new agency unnecessary and potentially disruptive.

The proposed NC-DOGI bill seeks to establish a specialised agency responsible for dismantling, removing, and restoring oil and gas installations at the end of their operational life. Proponents of the bill say the commission would help ensure environmental protection and prevent ecological hazards, particularly in the Niger Delta.

However, government officials maintained that the PIA already addresses these issues, and creating a separate body would lead to duplication of duties, regulatory conflicts, and potential investor uncertainty.

Minister Lokpobiri explained that the proposed commission would not resolve community concerns, as the Host Community Development Trust Fund already handles such matters — having generated nearly ₦400 billion for local development projects.

“Creating a new commission for decommissioning and abandonment would only duplicate the functions of the NUPRC under Sections 232 and 233 of the PIA 2021,” Lokpobiri said, warning that such a move could deter investors.

He urged the House committee to withdraw the bill, stressing that maintaining a predictable and stable legal framework is essential for sustaining investor confidence.

NUPRC Chief Executive, Engr. Komolafe, aligned with the minister’s position, noting that establishing a separate decommissioning agency contradicts global best practices. He explained that decommissioning and abandonment are integral parts of a field’s development plan and should remain under the supervision of the upstream regulator.

“Having two different bodies oversee the Field Development Plan and decommissioning will fragment oversight and undermine the effectiveness of project management,” Komolafe stated.

He added that Nigeria’s oil and gas investment declined by about 75% between 2014 and 2021 due to the absence of a stable legal framework — a situation corrected by the enactment of the PIA. “Tinkering with the PIA now would send the wrong signal to the international community and discourage investment,” he warned.

Also speaking, NNPC’s Executive Vice-President (Upstream), Udobong Ntia, supported the position of the minister and the NUPRC boss, questioning the necessity of the proposed commission.

“Decommissioning is not a regular occurrence; it happens only at the end of a field’s life cycle. For instance, the NNPC does not expect any decommissioning activity until around 2045. What would such a commission be doing until then?” Ntia queried.

Earlier, Chairman of the House Committee on Petroleum Resources (Upstream), Hon. Alhassan Ado Doguwa, explained that the bill was conceived to address environmental and community challenges in oil-producing regions.

The committee is expected to review submissions from all stakeholders before making its final recommendations to the National Assembly.