The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) established the Alternative Dispute Resolution Centre (ADRC) to create a faster, cheaper, and more harmonious path for resolving disputes in Nigeria’s upstream petroleum sector, one capable of restoring investor confidence, easing tensions with host communities, and freeing billions of dollars trapped in long-running litigation. Chiemelie Ezeobi writes that now, with the ADRC gaining momentum, the commission is intensifying its push to make mediation and conciliation the industry’s first resort, not its last

When the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) established the Alternative Dispute Resolution Centre (ADRC) under the Petroleum Industry Act (PIA) 2021, its key derivatives were to operate as a neutral, sector-specific platform designed to mediate and resolve disputes arising from upstream operations in a timely, impartial, and cost-effective manner. 

Essentially, the goal was to create a faster, cheaper, and more harmonious pathway for resolving conflicts in Nigeria’s oil and gas sector, one that would keep investors engaged, restore trust among host communities, and dismantle the bottlenecks that had trapped billions of dollars in litigation for decades.

This was because for years, disputes in the upstream petroleum industry were synonymous with long court battles, delayed investments, and fracturing relationships between operators, regulators, and communities. 

In fact, arbitration cases stretched across continents with court matters dragged for as much as a decade or two. At the same time, capital that should have been developing oilfields or funding exploration remained frozen in legal uncertainty.

 It was within this context that the NUPRC designed what would become one of the boldest institutional reforms under the Petroleum Industry Act (PIA), now referred to as the ADRC. 

Housed within the National Oil and Gas Excellence Centre (NOGEC) in Lagos, the ADRC is structured to offer arbitration, mediation, and conciliation, an industry-specific solution to an industry-specific problem. 

The Body of Neutrals, a hand-picked pool of experts including lawyers, retired judges, technical specialists, and oil and gas professionals, were inaugurated in Lagos and Yenagoa in September 2024, who were charged with providing the upstream sector with a trusted, neutral, and highly skilled platform to resolve disputes swiftly, quietly, and cost-effectively. 

Push for More Transformative ADR

Since its launch, the centre has been active but now, the commission has intensified its push to make the platform not just functional, but more transformative.

This was the crux of a recent high-level Roundtable Consultative and Sensitisation Forum held in Lagos, where the NUPRC’s Chief Executive, Engr. Gbenga Komolafe, underscored the place of the ADRC at the heart of NUPRC’s regulatory philosophy. 

Represented by the Commission Secretary and Legal Adviser, Mrs. Olayemi Adeboyejo, he described the centre as a cornerstone of reform and a catalyst for investment.

The sensitisation forum drew participants from International Oil Companies (IOCs), independent producers, Host Community Development Trusts (HCDTs), and other industry players, providing a platform for open dialogue on the centre’s processes, functions, and adoption pathways.

He said, “The ADRC is more than a mechanism for resolving disputes. It is a strategic tool for promoting peace, stability, and investor confidence across the upstream petroleum value chain. We are determined to make ADRC not a last resort, but the first choice for dispute resolution in Nigeria’s oil and gas sector.”

Komolafe emphasised that the ADRC gives practical expression to the intent of the PIA, which prioritises dialogue, fairness, and the protection of relationships vital to industry stability. 

“Through the ADRC, we are operationalising the PIA’s intent ensuring that disputes are resolved amicably and efficiently, preserving relationships that are essential to operational stability, investment protection, and social harmony,” he said.

The initiative has been particularly crucial in addressing tensions between operators and host communities. With lingering grievances, compensation disputes, and project delays historically turning into litigation, mediation has provided a more sustainable route for engagement. 

Komolafe added, “Dispute prevention and early engagement are key to building trust. By encouraging operators, host communities, and other stakeholders to embrace ADR mechanisms early, we are fostering a culture of mutual respect, accountability, and collaboration.”

He urged corporate leaders, General Counsel, and Legal Directors across the industry to see the ADRC not merely as a regulatory creation but as a strategic instrument. 

“The sustainability and effectiveness of the ADRC depend on collaboration. Regulators, operators, host communities, and civil society must continue to work together to build trust, prevent disputes, and maintain a stable operating environment,” he noted.

Reiterating the NUPRC’s unwavering commitment to building an industry where dialogue replaces discord and cooperation replaces confrontation, he added that “the ADRC symbolises our belief that disagreements can be transformed into opportunities for understanding. 

“It is a cornerstone of our broader reform agenda, anchored on transparency, fairness, and shared prosperity. Through this centre, we are not only resolving disputes, but also reinforcing the confidence of investors and the trust of host communities in the Nigerian petroleum industry”.

A Strategic De-bottlenecking Mechanism

In her remarks at the same event, NUPRC’s Secretary and Legal Adviser, Mrs. Olayemi Adeboyejo, spoke with the frankness of someone who has witnessed the financial and operational toll of litigation. She warned that Nigeria could not afford the cost of “justice delayed” in a globally competitive energy market.

She said, “When people say ‘let the court decide,’ they often mean ‘see you in 10 years.’ That’s not justice delayed; that’s capital detained.”

Adeboyejo explained that some oil-sector disputes stay active in the court system for nearly a decade, delays that disrupt production timelines, scare away investors, and create an unpredictable operating environment. She described the ADRC as a “strategic de-bottlenecking mechanism” designed to offer confidentiality, speed, and cost savings.

Highlighting global data, she noted that mediation resolves 80 to 90 per cent of disputes within days or weeks, a sharp contrast to the endless adjournments of traditional courts. 

To ensure trust, the ADRC operates on three principles: an independent Body of Neutrals, joint appointment and payment of mediators by both parties, and strict confidentiality.

Stakeholders Push for Legal Certainty

The forum, which brought together IOCs, independent producers, HCDTs and other industry players, including civil society groups, signalled how central dispute resolution has become to Nigeria’s competitiveness.

PETAN Vice Chairman, Obi Uzu, commended the commission but emphasised the need for deeper legal backing, adding that, “If ADR isn’t referenced in contracts, resolutions can’t be enforced. Legal backing is key to building trust and making the system work”.

His comment reflected a growing belief that ADR provisions must be embedded at the contracting stage, an approach common in jurisdictions that rely heavily on regulatory mediation.

For Chief Executive Officer of The Dispute Solutions Hub and Principal Partner at Adeyemi Law Firm, Mr. Adeyemi Akisanya, the future of the industry lies squarely in mediation.

Noting that most conventional  court systems have become congested, and cases can take 20 to 30 years, he said mediation offers a quick, efficient, and practical way to preserve business relationships in the oil and gas sector by focusing on solutions that satisfy both parties while maintaining mutual respect and ensuring business continuity.

From Litigation to a Future Built on Dialogue

As NUPRC continues its advocacy, the message is clear: disputes should not cripple Nigeria’s upstream ambitions. The commission’s push to increase adoption by engaging legal directors in IOCs and independent producers reflects its belief that early referral of disputes will transform the operating environment.

The ADRC’s structure, specialised, confidential, neutral, and grounded in deep technical expertise, mirrors global best practice. Its mission goes beyond settlement. It is designed to strengthen relationships, reduce operational downtime, and create predictability in a sector defined by high stakes and complex partnerships.

Komolafe summarised this ethos when he said, “The ADRC symbolises our belief that disagreements can be transformed into opportunities for understanding. It is a cornerstone of our broader reform agenda, anchored on transparency, fairness, and shared prosperity.”

Through the ADRC, the NUPRC aims to build an industry where collaboration replaces conflict and where disputes, inevitable in a complex sector, do not become obstacles to investment or national growth. The sensitisation forum reinforced that the industry now stands at a turning point, choosing between the old order of endless litigation and a new era of cooperative, efficient dispute resolution.

As Nigeria positions itself for greater investment inflows and seeks to stabilise its upstream operations, the ADRC is emerging as one of the most critical tools for restoring investor confidence and ensuring peaceful coexistence with host communities.

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