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Senate Frowns At Oil Companies Over Failure To Restore Exploited Sites In Niger Delta

…Mandates Committee on Petroleum Resources Upstream To Carry Out Investigation



The Senate of the Federal Republic moved against oil companies operating in the Niger Delta Region who fail to restore exploited sites after the expiration of their lease.

This followed a motion sponsored by Senator Gershom Bassey on the need to investigate the degree of abandonment and decommissioning obligations in oil and gas exploration contracts.

The Senate at its sitting on Wednesday, noted that the abandonment and decommissioning costs are associated with the physical removal and disposal of obsolete oil installations at the end of their operational life and the restoration of the environment to the state it was before exploitation.

It further noted that the UN Convention on the law of the seas Art.60 (3), Geneva Convention Article 5(5), the Oslo and Paris Convention for the protection of marine environment, the 1967 Territorial Waters Act and the Petroleum Act of 1969 all have provisions for the mandatory abandonment and decommissioning for oil companies.

The Senate however expressed displeasure that most oil companies operating in Niger Delta fail to restore exploited sites after the expiration of their lease.

Speaking alongside other senators in support of the motion, the Chairman, Senate Committee on Petroleum Resources Upstream, Senator Bassey Albert (OBA) said the country cannot afford to sleep over the issue as host communities are being exposed to danger daily. Maintaining that the right thing should be done to protect the host communities, Senator Albert supported the motion that oil companies be investigated.

Consequently the Senate mandated its Committee on Petroleum Resources Upstream chaired by Senator Albert to conduct a comprehensive review of the relevant laws, Product Sharing Contracts (PSC), Joint Venture Contracts (JVC) and arrangements governing abandonment, decommissioning, remediation and investigate the degree of compliance with these laws by oil companies operating in Nigeria.

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