- NUPRC’s decommissioning plans, approved since 2023, now carry $4.4 billion in liabilities, with $400 million already secured.
- NEITI insists on strict audit compliance to boost transparency, investor confidence, and citizens’ trust in the energy sector.
NUPRC‘s decommissioning plans now total $4.4 billion, with $400 million already secured through escrow accounts and letters of credit. Chief Executive Gbenga Komolafe announced this progress at the Nigerian Extractive Industries Transparency Initiative (NEITI) Companies Forum in Lagos.
Since April 2023, the commission has approved 94 decommissioning and abandonment plans, in strict alignment with the Petroleum Industry Act (PIA) 2021. Operators will gradually remit these liabilities during the lifespan of their oilfields, ensuring compliance with financial safeguards.
Komolafe stressed that Nigeria must avoid the costly errors seen abroad. He referred to the North Sea, the Gulf of Mexico, Canada, and Australia, where weak frameworks created heavy financial and environmental burdens.
Strong regulation, he argued, remains the only safeguard against such risks. Recent divestments were, therefore, tested thoroughly. These included NAOC’s sale to Oando Energy Resources, Equinor’s transfer to Chappal Energies, Mobil’s deal with Seplat, Shell’s exit to Renaissance Africa Energy, and TotalEnergies’ transfer to Telema Energies. Each transaction faced strict checks on technical capacity, financial strength, and escrow-backed commitments.
According to the commission, host community obligations have already been honoured. In addition, companies pledged $9.2 million for environmental remediation pending final approval of the Environmental Remediation Fund regulations. Escrow accounts must also remain domiciled in Nigeria to guarantee transparency and accountability.
NEITI’s Executive Secretary, Dr Ogbonnaya Orji, backed this stance. He insisted that audit compliance is mandatory, not optional. Transparency and accountability, he explained, strengthen investor confidence and improve citizens’ trust in Nigeria’s energy industry. Work on the 2024 NEITI Industry Reports has already started, and companies were urged to meet their reporting deadlines.
Nevertheless, some industry leaders voiced concerns about overlapping requests for payments and data from multiple agencies. They argued that these practices discourage investment. However, NUPRC and NEITI reaffirmed their commitment to transparency, accountability, and investor confidence. In this context, NUPRC decommissioning plans demonstrate that stricter oversight can protect the environment, secure financial obligations, and support long-term energy stability.