Business
NUPRC advocates effective ADR to boost investor confidence, unlock trapped capital
To boost investor confidence and unlock billions of dollars in potential investments trapped in prolonged litigation, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has urged stakeholders to use its Alternative Dispute Resolution Centre (ADRC).
The commission reaffirmed its commitment to entrenching fairness, transparency, and collaboration in the country’s upstream sector through the institutionalisation of ADR mechanisms.
NUPRC’s Chief Executive, Gbenga Komolafe, declared this at a high-level Roundtable Consultative and Sensitisation Forum organised in Lagos by the commission’s ADR centre.
Represented by the commission’s Secretary and Legal Adviser, Olayemi Adeboyejo, Komolafe said ADRC also aimed at ensuring sustainable relationships between operators and host communities.
According to Komolafe, the ADRC was established as a specialised, neutral platform for resolving disputes in the upstream sector, adding that key milestones have been achieved since inception.
Some of the milestones Komolafe listed included the inauguration of the ADRC Body of Neutrals in Lagos and Yenagoa in September 2024, and a comprehensive capacity-building programme earlier this year.
Komolafe said by offering mediation, the centre would ensure timely, impartial, and cost-effective resolution consistent with international best practices, noting that the ADRC’s board comprised seasoned lawyers, retired judges, and technical experts versed in ADR and oil industry operations.
“The ADRC is more than a mechanism for resolving disputes. It is a strategic tool for promoting peace, stability, and investor confidence across the upstream petroleum value chain.
“Through the ADRC, we are operationalising the Petroleum Industry Act’s (PIA) intent, ensuring that disputes are resolved amicably and efficiently, preserving relationships that are essential to operational stability, investment protection, and social harmony.
“We are determined to make ADRC not a last resort, but the first choice for dispute resolution in Nigeria’s oil and gas sector,” said Komolafe.
He added that the commission’s proactive promotion of alternative dispute resolution has been particularly instrumental in mitigating tensions between operators and host communities, adding that the centre offered a sustainable pathway for peaceful coexistence in the petroleum industry.
He said, “Dispute prevention and early engagement are key to building trust. By encouraging operators, host communities, and other stakeholders to embrace ADR mechanisms early, we are fostering a culture of mutual respect, accountability, and collaboration.”
He encouraged stakeholders in the oil and gas ecosystem to view the ADRC as a strategic ally in corporate governance and risk management, not as a regulatory instrument.
“The sustainability and effectiveness of the ADRC depend on collaboration. Regulators, operators, host communities, and civil society must continue to work together to build trust, prevent disputes, and maintain a stable operating environment,” he added.
Komolafe reiterated the NUPRC’s unwavering commitment to building an industry where dialogue replaces discord and cooperation replaces confrontation.
“The ADRC symbolises our belief that disagreements can be transformed into opportunities for understanding. It is a cornerstone of our broader reform agenda anchored on transparency, fairness, and shared prosperity. Through this centre, we are not only resolving disputes, but also reinforcing the confidence of investors and the trust of host communities in the Nigerian petroleum industry,” he re-echoed.
In her welcome remark as Secretary of the Commission, Adeboyejo said ADRC was necessary in today’s global and domestic landscape, noting that Nigeria cannot afford to have billions of dollars in potential investment trapped in prolonged litigation.
She said prolonged litigation was a major impediment to the oil sector’s growth, noting that some disputes take up to a decade to reach final judgment.
“In Nigeria, when people say ‘let the court decide,’ they often mean ‘see you in ten years’. That’s not justice delayed; that’s capital detained.”
“The ADRC was therefore conceived as a strategic de-bottlenecking mechanism; an efficient, confidential, and cost-effective alternative to litigation.”
The sensitisation forum drew participants from International Oil Companies (IOCs), independent producers, PETAN, Host Community Development Trusts (HCDTs), and other industry players, providing a platform for open dialogue on the centre’s processes, functions, and adoption pathways.
Citing global data, she said mediation resolves 80–90 percent of referred disputes within days or weeks.
Adeboyejo outlined three principles guaranteeing the centre’s neutrality: an independent body of neutrals, joint appointment and payment of mediators by disputing parties, and confidentiality of proceedings.
“What happens in mediation stays in mediation. No journalist will get a scoop from your meditation room,” she assured.
During an interview with reporters, the Vice Chairman of Petroleum Technology Association of Nigeria (PETAN), Obi Uzu, described the initiative as a vital step toward resolving long-standing contractual and payment disputes.
However, he called for a clear legal framework compelling industry recognition of the platform in standard contracts.
“If ADR isn’t referenced in contracts, resolutions can’t be enforced. Legal backing is key to building trust and making the system work,” he stressed.
The Chief Executive, Dispute Solutions Hub, Adeyemi Akinsanya, said mediation represents the future of dispute resolution in the oil and gas industry.
“Most courts are congested, and cases can take 20 to 30 years. Mediation offers a quick, efficient, and practical way to preserve business relationships,” he said.
Source link
