Assessing Nigeria's Petroleum Industry Act 2021: Implications For The Global Energy Transition

Abstract

The escalating impacts of climate change over recent decades have necessitated urgent action from nations heavily reliant on oil and gas to mitigate environmental harm and advance the global energy transition agenda. Despite Nigeria’s commitment particularly evidenced by the enactment of the Petroleum Industry Act (PIA) 2021 aimed in part at reducing gas flaring, significant challenges persist. Central among these is how Nigeria can reconcile revenue generation from its substantial oil reserves with its obligations toward energy transition. This study evaluates the PIA 2021’s regulatory framework in light of Nigeria’s pursuit of a sustainable energy future and its commitments under the Nationally Determined Contributions (NDCs) submitted in July 2021. Adopting a doctrinal legal research methodology and analysing both primary sources such as the PIA 2021 and secondary literature, the study finds that while the PIA represents progress, critical gaps remain. Notably, it highlights the need for the establishment of a Future Energy Fund to support renewable initiatives and calls for amendments to key provisions, such as Section 104, which confer excessive discretionary powers on regulatory authorities. The study concludes that targeted legal reforms are essential to develop a comprehensive regulatory framework capable of ensuring country’s effective transition to a sustainable energy economy.