Assessment of Produced Formation Water Management Policy in Nigeria's Oil and Gas Industry

Abstract

Oil and gas production activities generate several types of waste streams, which require effective and efficient management due to the hazardous nature of these wastes. One type of waste is Produced formation water (PFW). Research has shown that PFW comprises several toxic constituents which pose a threat to the environment if not properly managed. However, according to compliance statistics obtained from the NUPRC, a vast majority of oil and gas companies in Nigeria do not currently comply with the existing primary regulations for PFW management in Nigeria as enshrined in the Environmental Guidelines and Standards for the Petroleum Industry in Nigeria (EGASPIN 2018). In other to assess the reasons for the lack of effective implementation of the policy instrument (regulations) for PFW management, the Contextual Interaction Theory (CIT) was used to analyze the existing PFW regulatory framework vis a vis its effect on policy implementation and gain an insight into the perspectives of key stakeholders regarding the management of this waste. The CIT envisions policy implementation process as an actor-centric interaction process comprising human actions primarily determined/influenced by certain core variables (Motivation, Information and Power). The assessment revealed that although there exists a plethora of policy instruments (specific and generic) and Government actors directly and indirectly relevant to PFW management only the NUPRC primarily drives compliance via the EGASPIN. Policy implementation is via direct regulation which requires audits and spot checks, but the NUPRC lacks the resources (manpower and finance) to ensure adequate implementation hence rely on the operators for logistics to meet their mandate in this regard which tilts the balance of power in favor of the Operators. Also, fines and penalties prescribed in the policy instruments are not weighty to serve as deterrent to defaulters. Most of the target group opines that they were not fully involved in the policy instrument formulation process and that the regulations are not exhaustive and too stringent hence motivation to comply is lacking. Plausible and feasible short, medium and long-term recommendations were proffered which could enhance implementation. This involves synergy with other Government actors, imposing commensurate waiver fees, fines and sanctions, carrot and stick approach, alternative or novel approaches for management of this waste stream and a review of the existing policy instruments with the full participation of all relevant stakeholders.