LEGAL FRAMEWORK FOR DECOMMISSIONING OIL AND GAS FACILITIES IN NIGERIA

Abstract

In the Oil and Gas sector, once an oil or gas field reaches the end of its economically productive life, operators are required to remove or appropriately decommission offshore platforms and associated facilities, or fully abandon the field where necessary. Decommissioning of oil and gas structures becomes unavoidable once these facilities reach the end of their operational lifespan and further life-extension or replacement options are no longer technically feasible or economically justifiable1. In many cases, declining production levels and increasing operating costs make continued operation financially unsustainable.2 The aim of the study is to explore the legal framework for decommissioning Oil and Gas Facilities in Nigeria. The findings revealed that some of the international frameworks for decommissioning are: the Geneva Convention, 1958, United Nations Convention on the Law of the Sea (UNCLOS), International Maritime Organisation  Guidelines and Standards for the Removal of Offshore Installations and Structures, while the national laws are the Petroleum Industry Act, Midstream and Downstream Decommissioning and Abandonment Regulations, 2023, and Nigerian Upstream Petroleum Decommissioning and Abandonment Regulations, 2026. Also, some of the challenges experienced in decommissioning are Financial/ Cost Implications, Non-Domestication of Regional and Global Treaties, Lack of Decommissioning Experience and Regulatory Lacuna. Some recommendations made in the work are strengthening regulatory capacity, improving decommissioning funding, and establishing and maintaining a comprehensive petroleum infrastructure database. Conclusively, Nigeria has developed a more comprehensive legal and regulatory framework for the decommissioning and abandonment of petroleum facilities through the PIA, relevant regulations, and applicable international standards. However, implementation remains the major challenge.