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20 Jan

OIL AND GAS 2.1E PIPELINES (DECOMMISSIONING AND DISPOSAL)

DECOMMISSIONING AND DISPOSAL: the issue of decommissioning arises where a reservoir is depleted. i.e. where the well supplies oil to the pipeline has been exhausted. Decommissioning entails the removal and disposal of obsolete installations. May include plugging wells with cement to protect ground water communication and removal of equipment[1].

Regulation 35 and 45 of the Petroleum Drilling and Production Regulation, the Environmental Impact Assessment Act and the Oil Pipelines Act deal with onshore decommissioning. They mandate that:

  • The written consent of the Director of Petroleum Resources must be sought.
  • The well(s) should be securely plugged/sealed to prevent contamination of ground water.
  • The environment and premises should be restored as far as possible to their original conditions.
  • An environmental impact assessment report is needed to show the effect of the decommissioning on the environment.

For offshore decommissioning:

  • The EGASPIN provides that all installations weighing less than 4,000 tons should be entirely removed from the seabed.
  • Article 60 of the UNCLOS[2] provides that due regard must be had to the protection of the environment.

Note also that upon the termination of the license, the holder would have to make arrangements for the disposal/removal of the pipeline (and ancillary installations) within three months from the termination of such license. He can transfer/sell the pipeline to the minister at an agreed price or at a price to be determined by arbitration[3]. In disposing, he should make good any damage done to land as a result of the removal[4].

[1] Dr Ayoade; Environmental Risk and Decommissioning of Offshore Oil Platforms.

[2] The United Nations Convention on the Laws of the Sea.

[3] Section 28.

[4] Section 28(2).

Isochukwu

Quite eccentric really

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