NUPRC Pushes for Faster Dispute Resolution in Nigeria’s Oil and Gas Sector.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has called for the establishment of Alternative Dispute Resolution Centers (ADRCs) within oil-producing regions, aiming to expedite the resolution of disputes in the upstream oil and gas sector.
This initiative was highlighted during a Stakeholders’ Engagement and Consultation session on the Draft Rules of Procedure for the ADRC held in Lagos on Thursday.
Mr. Gbenga Komolafe, the Chief Executive of NUPRC, represented by Mr. Enorense Amadasu, the Commission’s Executive Commissioner for Development and Production, stated that the creation of these centers is crucial for stabilizing and addressing disputes related to commercial operations, production, and host community issues in the oil and gas industry.
“This initiative marks a significant advancement in improving the efficiency, fairness, and effectiveness of dispute resolution within the upstream industry,” Komolafe noted. He added that the ADRC, established in 2021, is a testament to the Commission’s commitment to providing a robust framework for timely dispute resolution.
The ADRC is expected to alleviate the burden on the courts, reduce litigation costs, and foster a collaborative approach to dispute resolution, which is essential for maintaining a harmonious business environment and ensuring the sector’s continued growth.
Mrs. Olayemi Anyanechi, NUPRC’s Commission Secretary and Legal Adviser, emphasized the Commission’s dedication to making ADRC centers a source of pride for both Nigeria and Africa.
She mentioned that NUPRC has been working closely with stakeholders, including mediators, arbitrators, industry leaders, and business lawyers, to refine the ADRC’s rules and procedures. Once finalized, these procedures will be implemented at the centers, which will focus on mediating and resolving disputes in the Nigerian upstream oil and gas sector.
Anyanechi highlighted that the ADRC has already proven effective, citing the resolution of disputes from the 2020 marginal field allocations as a key example. She also noted that in 2024 alone, the Commission handled approximately 70 court cases, which incurred substantial costs.
This experience underscored the necessity for NUPRC to regulate and oversee the industry to resolve disputes more efficiently outside the courtroom.
The ADRC is set to play a critical role in reducing costs and addressing disputes peacefully, particularly in oil-producing communities, thereby contributing to the stability and sustainable growth of Nigeria’s vital oil and gas sector.
Komolafe further stated that the ADRC aims to deliver an innovative, efficient, and cost-effective approach to dispute resolution, reinforcing industry stability and promoting sustainable growth.
He underscored the importance of collaboration and active stakeholder participation in developing the ADRC Draft Rules of Procedure.
Mrs Olayemi Anyanechi, Commission Secretary and Legal Adviser, noted that the Commission has been working diligently to make ADRC centers a source of pride for Nigeria and Africa.
She mentioned that NUPRC has invited stakeholders, mediators, arbitrators, industry leaders, and business lawyers to review and refine the ADRC laws and procedures.
She said that once the final draft is agreed upon, the Commission plans to implement the ADRC processes at the centers.
According to Anyanechi, these centers will mediate and resolve disputes in the Nigerian upstream oil and gas sector.
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“The Nigerian oil and gas industry is vital but can be contentious, with many cases arising. When the Commission was established, one of its priorities was to address dispute resolution effectively.
“For instance, disputes from the 2020 marginal field allocations were resolved through engagement with awardees outside the courts,” she explained.
Anyanechi also highlighted that issues related to the Petroleum Industry Act (PIA) and host communities had required the Commission’s intervention.
“In 2024 alone, the Commission handled around 70 court cases, which incurred substantial costs.
” This highlighted the need for NUPRC to regulate and oversee the industry to resolve disputes efficiently outside the courtroom.
She concluded that the ADRC process has begun to yield positive results, emphasising that the centers will focus on oil-producing communities to reduce costs and address disputes peacefully
