Nigeria’s Oil Reforms Win Global Praise, But Lawmakers Sound Alarm On Ageing Assets

Nigeria’s efforts to reform its oil and gas sector are receiving mixed reactions, with industry analysts lauding sweeping regulatory changes while lawmakers express concern over inadequate enforcement of safety and environmental rules.

A recent sector review commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its implementation of the Petroleum Industry Act (PIA), noting that reforms over the past year have strengthened investor confidence, modernised oversight, and increased transparency in the upstream sector. The report highlighted improvements such as digitised monitoring systems, more efficient regulatory timelines, and clearer fiscal frameworks, all of which are reshaping Nigeria’s profile in global capital markets.

According to the review, NUPRC’s adoption of digital supervision for production, metering accuracy, fiscal compliance, and environmental performance has significantly enhanced the reliability of sector data. “These digital tools have reduced reporting delays, improved data integrity, and increased the global credibility of Nigeria’s upstream statistics,” the report stated. The availability of real-time, dependable data is seen as a key indicator of a trustworthy investment climate, raising confidence among both domestic and international investors.

The review also praised the clarity of licensing and approval procedures, noting that structured engagement between regulators and operators has created a more efficient operating environment. Fiscal certainty under the PIA has encouraged activity around marginal fields, revitalised dormant licences, and attracted renewed commitments from both indigenous and international players.

The report additionally highlighted progress in gas markets, including domestic gas delivery obligations and frameworks for flare-gas commercialisation, which are described as crucial to Nigeria’s energy transition. Customer-focused initiatives, such as improvements to the One-Stop Regulatory Centre, have also been noted for reducing bureaucratic barriers and supporting operational efficiency.

Despite these positive developments, lawmakers are warning of significant risks associated with ageing oil and gas assets. The House of Representatives’ Ad-hoc Committee on Decommissioning and Abandonment has accused upstream and midstream regulators of failing to enforce PIA provisions, particularly those requiring operators to create financial reserves for the decommissioning of obsolete infrastructure. The committee cited a potential $20 billion funding gap and growing liabilities as a major concern.

Regulatory officials defended their actions, noting enforcement under Sections 232 and 233 of the PIA, which mandate inclusion of decommissioning plans in field development applications. Nevertheless, committee chairman Bassey Ekpenyong criticised the slow operationalisation of long-standing regulations, stressing the environmental and financial risks posed to host communities if decommissioning rules remain unimplemented. The committee’s investigation continues amid calls for stronger regulatory discipline and timely enforcement.