Part VII – Health, Safety & Environment

Unlike the Petroleum Act which vests powers to make regulations regarding the environment on the Minister, the Bill vests such powers on the Agency or the Inspectorate (in consultation with the Ministry of Environment) depending on whether the matter relates to the upstream or downstream sector of the industry. However, the Bill further provides that licensees are required to comply with all environmental health and safety laws, regulations, guidelines or directives as may be issued by the Ministry of Environment, the Minister, the Inspectorate or the Agency.

It should also be noted that that fines to be paid for violation of these provisions are to be prescribed by the Inspectorate and the Agency in consultation with the Minister.

Obligations of licensees under Part VII of the Bill include:

  • Adopting the principle of sustainable development in operations;
  • Utilisation of good oil field practices;
  • Rehabilitation of environment affected by operations provided that the licensee shall not be responsible for rehabilitation where the damage to the environment is as a result of acts of sabotage to petroleum facilities. Disputes regarding ascertainment of cause of damage shall be referred to the Agency which shall be the final arbiter of such dispute.

The Agency is also responsible for issuing guidelines on rates of compensation (referred to as fair and adequate compensation) to be paid by upstream petroleum licensees to land owners or legitimate occupiers of the licensed or leased lands.

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