FG Set to Withdraw Licence of Dormant Oil Wells in Nigeria

The House of Representatives has commenced moves to amend the Petroleum Industry Act to make provision for non-producing oil wells to lose their operational licences. On September 26, 2024, the House passed for first reading “A bill for an Act to amend the Petroleum Industry Act, 2021 to provide for licensing requirements for the operation of oil wells, petroleum prospecting licenses and, for revocation of licenses from non-performing oil fields and for related matters. It is anticipated that in the coming weeks, the Green Chambers floor will reconvene to discuss the measure presented by Ikenga Ugochinyere, the member representing Ideato North/Ideato South Federal Constituency, Imo State.
According to a copy of the draft that The PUNCH reported, the proposed law would add additional sub-sections 2 and 3 to Section 81 in order to alter it. On licensing requirements for petroleum mining lease, sub-section 2 specifies that a petroleum mining lease shall be issued under sub-section 1 of this section where the holder of a petroleum prospecting licence exhibits a minimum crude oil refining capability of 50,000 barrels per day. Subsection 2(a) has been amended to permit licensees with limited refining capacity to collaborate in order to operate. “Any petroleum prospecting licensee without the minimum crude oil refining capacity specified in this section may form a consortium consisting of not more than five licensees and such a consortium shall be granted a license for the field.”
Since its enactment in 2021, there have been calls from stakeholders including the Host Communities of Nigeria Producing Oil and Gas, Independent Petroleum Producers, and Oil Producers Trade Section, among others for the amendment of the PIA.

Source: legit.ng

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