“The Future of Nigeria’s Oil and Gas Industry: Emerging Divestment, Legal Framework, Environmental and Social Governance (ESG), Energy Security and Casualization of Labour”.

Abstract

Nigeria’s oil and gas industry has been the central to the country’s political economy since the commercial discovery of oil in the 1950s, providing the bulk of export earnings and a large share of government revenue. This paper examines the emerging dynamics of divestment, the Nigerian legal framework for oil and gas, ESG application and constraints, energy security considerations, and labour casualization. For decades the sector operated under the Petroleum Act 1969 and through joint ventures dominated by international oil companies and state interests. Hence, Nigeria’s failure to reliably refine crude domestically has led to sustained imports of refined petroleum products, undermining the economic benefits of its crude endowment. In Nigeria, some international firms have restructured portfolios or sought partners to manage risk exposure, while local and regional players have taken on certain assets. The legal framework in the Nigeria oil and gas comprises of the following; Petroleum Act (1969), Petroleum Industry Act (2021), Nigerian Oil and Gas Industry Content Development Act (2010), Environmental Impact Assessment Act (1992), National Oil Spill Detection and Response Agency Act (2006). Challenges facing the country’s oil and gas industry include Niger-Delta Crisis, Government underfunding, Long Contract Award Process and Infrastructure. The study concluded that the future of Nigeria’s oil and gas industry hinges on the quality of legal implementation, credible ESG delivery, strategic management of divestment pressures, resolute action to improve energy security, and reversing trends of labour casualization. The study recommended amongst others that the Government should implement and operationalize the Petroleum Industry Act (2021) with urgency and transparency: publish implementing regulations, fully staff regulatory bodies, and establish clear timelines for phasing in provisions that govern licensing, revenue flows and environmental obligations.

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