A Review of the Nigerian Energy Industry

Nigeria: Oil sector regulators lacking in capacity — Report

*Dr. Emmanuel Ibe Kachikwu, Minister of State for Petroleum Resources

Ike Amos

10 January 2018, Sweetcrude, Abuja – The Nigeria Natural Resource Charter, NNRC, has disclosed that regulatory authorities in the Nigeria petroleum industry lack the requisite capacity to effectively monitor operations of companies in the industry.

This was contained in NNRC’s presentation of the summary of findings from the 2017 Benchmarking Exercise Report in Abuja, heralding the actual launch of the report later this month.

The report were presented by Mrs. Tengi George-Ikoli, Programme Coordinator, NNRC, along with its partners from the Centre for Public Policy Alternatives, CPPA; Centre for the Study of the Economies of Africa, CSEA; Centre for Social Justice, CSJ; Civil Society Legislative Advocacy, CISLAC; and Social Action.

According to the report, there are established legal and institutional frameworks for the monitoring of operations of companies during each stage of the project life cycle.

At the moment, it lamented that the regulatory authorities, especially the Department of Petroleum Resources, DPR, do not have sufficient capacity to verify all the various types of geological, geophysical and technical data periodically reported by the operating companies.

It, however, noted that the responsible institutions should be strengthened to enhance their effectiveness.

The report said: “The law stipulates that a Progress Report be submitted within 21 days after the end of each month through the Director, Petroleum Resources and Director of Geological Survey. Other reports are due every quarter and two months after the end of each calendar year, respectively.

“This way it collects data meant to be used to update the data in the DPR’s National Data Repository, NDR, which is responsible for maintaining data as provided for in the NDR Regulations 2007.”

In addition, it averred that the Federal Government evaluates and approves development plans, noting, however, that there are typically notable delays.

“The bureaucratic inefficiencies, weak inter-agency collaboration and the use of manual processes contribute to these undue delays, while the DPR works to ensure all interests are addressed. There is a need to stipulate specific timelines and enable the institutions to be more effective and keep to them,” the report stated.

In the area of community development, the report noted that there are no requirements in Nigeria that provide for free, prior and informed consent with indigenous communities potentially displaced by project developments.

It also disclosed that the government was yet to put in place a legislation or framework to ensure consultation and meaningful participation of affected communities in decision-making about resource projects.

According to the report, the failure to involve communities early enough by the government and limited effort to communicate and provide information to set reasonable expectations among communities had led to limited awareness about the costs and benefits of extraction.

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