The Nigerian Midstream and Downstream Petroleum Regulatory Authority has warned that uncertainty over regulations could discourage investment in Nigeria’s oil and gas industry.
The Chief Executive of the authority, Rabiu Umar, said investors could manage commercial and market risks but were less willing to commit funds when government policies and regulatory decisions were unpredictable.
Umar made the remarks on Wednesday while highlighting the importance of regulatory certainty to the growth of the midstream and downstream petroleum sectors.
He said measures such as fiscal incentives, financing support and policy reforms would have limited impact if investors remained unsure about how regulations would be applied.
According to him, investors need clear rules, consistent decisions and predictable regulatory processes to make long-term investment commitments.
Umar noted that the issue was particularly important for major projects such as refineries, pipelines, storage facilities and gas infrastructure because they require significant capital and are expected to operate over many years.
He said the Petroleum Industry Act had established a legal framework aimed at promoting transparency, competition and accountability in the petroleum industry.
The NMDPRA boss, however, stressed that the benefits of the legislation would depend on consistent implementation by regulatory institutions.
Umar, who said he had nearly three decades of experience in the commercial and operational aspects of the downstream petroleum industry before joining the authority, said he understood the issues investors consider before committing capital.
He identified timely approvals, consistent enforcement of regulations and fair decision-making as key elements of an investment-friendly regulatory environment.
He added that effective regulation should go beyond issuing licences and enforcing compliance, saying it should also provide businesses with the certainty required to plan and expand their operations.
Umar also called for greater cooperation among government agencies, noting that coordination was necessary to ensure that policies were implemented consistently across the sector.
He said every regulatory action, from granting licences to conducting inspections and making decisions, could influence investors’ perception of Nigeria’s business environment.
The NMDPRA chief executive assured industry stakeholders that the authority would continue to apply its mandate fairly, transparently and consistently as it seeks to strengthen investor confidence and support the development of the midstream and downstream petroleum sectors.
