Oil & Gas
A petroleum economist, Prof. Wumi Iledare, has urged the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to prioritise reforms that attract investment and improve regulatory efficiency.
Iledare, Emeritus Professor of Petroleum Economics and Policy Research at Louisiana State University, United States, made the call in an interview with NAN on Sunday.
He said the success of the Petroleum Industry Act (PIA) should be measured by economic value creation rather than licences issued or regulations enacted.
He said effective regulation should ensure Nigeria’s petroleum resources generate sustainable wealth for present and future generations.
Iledare noted that Nigeria competes with countries including Guyana, Brazil, Norway, the United States and the United Arab Emirates for investment capital.
He said investors increasingly favour jurisdictions offering regulatory certainty, transparent licensing systems, predictable policies and efficient institutions.
The economist identified lengthy approvals, overlapping responsibilities, policy inconsistencies and uncertainties surrounding host community implementation as major investment obstacles.
“Every unnecessary regulatory delay increases project costs, reduces profitability and weakens investor confidence,” he said.
He urged NUPRC to accelerate reforms by shortening approval timelines, strengthening transparency, maintaining fiscal stability and adopting digital technologies.
According to him, electronic licensing, automated reporting systems and artificial intelligence-driven compliance monitoring can significantly reduce bureaucracy and transaction costs.
He added that integrated digital platforms would improve operational efficiency and enhance Nigeria’s competitiveness in the global energy market.
Iledare stressed the importance of maintaining stable regulations throughout petroleum project lifecycles, which often extend between 20 and 30 years.
“Investors require long-term certainty because upstream petroleum investments are capital intensive and span several decades,” he said.
He also advocated investment incentives that improve project economics without undermining government revenues.
Such measures, he said, included flexible royalty structures, accelerated capital allowances, investment tax credits and performance-based incentives.
To support indigenous operators, Iledare recommended stronger reserves certification standards and greater transparency in petroleum sector data.
He also proposed reserve-based lending, infrastructure partnerships and development finance mechanisms to improve access to capital.
On security, he warned that oil theft, pipeline vandalism and production disruptions continue to undermine investment attractiveness.
“Insecurity functions as an implicit tax on investment,” he said, noting that it raises costs and reduces production efficiency.
He emphasised stronger collaboration among government, investors, operators and host communities to reduce operational risks.
According to him, trust and stable community relations help minimise project delays and improve investment outcomes.
Looking ahead, Iledare said the global energy transition should be viewed as an opportunity rather than a threat.
He urged Nigeria to position itself as a lower-carbon, lower-cost and more efficient petroleum producer.
The professor advocated expanded natural gas development, reduced methane emissions and stronger carbon management practices.
He described natural gas as a strategic transition fuel capable of supporting industrialisation and attracting responsible investment.
Iledare said NUPRC’s performance after five years of the PIA should be judged by outcomes rather than administrative activity.
He said success means investors earn competitive returns, government receives fair revenues and host communities benefit from resource development.
The economist added that Nigeria must also strengthen energy security and build greater economic resilience through effective resource management.
He said that regulatory performance should be assessed through efficiency, effectiveness, equity and ethics.
“Regulation should ultimately focus on creating value rather than simply producing more rules,” Iledare said.
He added that NUPRC’s long-term success depends on reducing risks, lowering transaction costs and maximising the value of Nigeria’s petroleum resources. (NAN)
F.O
Tags: NUPRC Reform drive