Oil & Gas: NUPRC secures $400m for asset decommissioning, abandonment liabilities

By Obas Esiedesa, Abuja

The Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, has announced that Nigeria has secured much than $400 cardinal successful decommissioning and abandonment liabilities, arsenic the Commission enforces stricter rules connected caller lipid and state plus transfers.

Komolafe disclosed this connected Wednesday astatine the Nigerian Extractive Industries Transparency Initiative (NEITI) Companies Forum successful Lagos. He said the determination was aimed astatine shielding Nigeria’s lipid and state assemblage from the costly experiences of different regions.

A connection by NUPRC’s Head of Media and Strategic Communications, Eniola Akinkuotu, noted that Komolafe, represented by the Deputy Director, Human Resources, Corporate Services & Administration, Efemona Bassey, spoke connected the theme: “Divestments, Liabilities, and the Impact of Ongoing Reforms connected Extractive Companies successful Nigeria.”

He explained that lessons from the North Sea, wherever decommissioning costs are projected to deed £27 cardinal by 2032; the Gulf of Mexico with costs exceeding $9 billion; and Canada’s Alberta state with much than 97,000 inactive wells carrying liabilities estimated betwixt C$30 cardinal and C$70 billion, informed the Commission’s approach.

According to him, these lessons guided caller divestment approvals involving large players specified arsenic NAOC to Oando Energy Resources; Equinor to Chappal Energies; Mobil Producing Nigeria Unlimited to Seplat Energies; SPDC to Renaissance Africa Energy; and TotalEnergies to Telema Energies.

“Without a robust and enforceable model for abandonment and decommissioning, divestment transitions tin make lasting fiscal and biology burdens,” Komolafe said. “Nigeria is not immune to this challenge, which is wherefore bold steps person been taken nether the Petroleum Industry Act and regulatory actions to forestall costly mistakes.”

He disclosed that each 2024 divestment was subjected to rigorous scrutiny, including assessments of method and fiscal capacity, arsenic good arsenic upfront escrow arrangements for decommissioning obligations.

“The results from 2024 talk for themselves. Over $400 cardinal successful pre-sale decommissioning and abandonment liabilities person been secured done Letters of Credit and escrow accounts,” helium said. “Host Community Development Trust obligations are afloat honoured, portion biology remediation commitments worthy implicit $9.2 cardinal person been pledged.”

Komolafe further revealed that since April 2023, NUPRC has approved 94 Decommissioning and Abandonment (D&A) plans, successful enactment with the PIA. These correspond liabilities of $4.424 billion, which volition beryllium remitted progressively implicit the beingness of the respective lipid fields into designated escrow accounts.

At the event, NEITI’s Executive Secretary, Dr. Orji Ogbonnaya Orji, emphasized that compliance with NEITI’s audit process is not optional but a ineligible request for companies successful Nigeria’s extractive industries.

He stressed that transparency and accountability stay captious for gathering capitalist confidence, strengthening nationalist trust, and aligning Nigeria’s extractive assemblage with planetary champion practices.

Dr. Orji added that the NEITI Companies Forum has go a cardinal level for fostering person partnerships with oil, gas, and mining firms portion improving Nigeria’s wide concern environment.

The station Oil & Gas: NUPRC secures $400m for plus decommissioning, abandonment liabilities appeared archetypal connected Vanguard News.