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DPR hopeful ADRC will check production, litigation costs


Department of Petroleum Resources

The Department of Petroleum Resources (DPR) has stated that the establishment of its Alternative Dispute Resolution Centre (ADRC) will eliminate unnecessary disputes and reduce litigation costs in the oil and gas industry.
The DPR also noted that oil and gas businesses under litigation have the potential of losing over 70 per cent of their value, hence the need to resort to ADRCs.
The Director and Chief Executive Officer, DPR, Sarki Auwalu, at the flag-off ceremony of the ADRC in Lagos, stated that the Centre would also help to bring down cost of production and cost of doing business in the country by addressing concerns early.
Auwalu noted that oil and gas-related disputes that are currently pending before the nation’s industrial courts and tribunals, usually take a considerable amount of time and cost to resolve, thus necessitating the establishment of the ADRC.
He stressed that in some instances, court judgments do not adequately resolve issues in a manner consistent with the regulatory and commercial interest of the industry.
“There was, therefore, awareness for the need to establish an ADRC specifically designed for the use of our industry in this country,” he said.
He added that the centre would ensure the settlement of disputes using industry experts who have an in-depth understanding of the issues for quick resolutions while maintaining that the establishment of the resolution centre would boost investors’ confidence by reducing cost of doing business, as well as capital flights occasioned by expensive out of country arbitration proceedings.
By setting up the Centre, he noted that the nation would also build the competence and capacity of Nigerians to become ADR professionals.
He said the use of the ADRC is voluntary, even as he urged parties to explore other forms of dispute resolution legally available.
He enjoined stakeholders in the industry to come together to guarantee and sustain the economy through oil and gas by eradicating unnecessary disputes and lingering legal cases.
‘We expect that all the dispute in the oil and gas industry would be resolved amicably as it would increase sustainability and investment while also reducing a lot of risks and uncertainties as you know that there are lots of litigation, which reduces profitability and confidence in the industry, but with the establishment of the ADRC, the litigation will be reduced or even eliminated.
Delivering his goodwill message, the Chairman, Petroleum Technology Association of Nigeria (PETAN), Nick Odinuwe, said the ADRC will assist the government to reduce the cost of doing business in the country, save time and address the cumbersome process of litigation.
He restated the association’s commitment to supporting DPR to flag off the ADRC.

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