Nigeria urged to review investment treaties over environmental risks — Premium Times Nigeria
In Port Harcourt, Nigeria, representatives of civil society organizations, local communities, and researchers called on the federal government to review bilateral investment treaties. In their view, investor protection provisions may limit the state's ability to introduce environmental regulations and implement energy transition policies.
This was stated in a communiqué following a roundtable on investor-state dispute settlement, energy transition, and investment governance, held on September 16. As Premium Times Nigeria reports, the event was organized by Policy Alert together with the Social Development Integrated Network and ActionAid, with the support of the Centre for Research on Multinational Corporations.
Risks of international arbitration
Participants discussed investor-state dispute settlement provisions in Nigeria's investment treaties, including the 1992 agreement between Nigeria and the Netherlands. Such a mechanism allows foreign investors to challenge certain state actions in international arbitration if they believe their treaty-protected rights have been violated.
The communiqué states that the threat of arbitration claims may deter authorities from adopting or enforcing climate and environmental regulations. Participants identified Shell's investments in the Bonga field, the state Decade of Gas initiative, and the further divestment of oil assets in the Niger Delta as potentially sensitive issues.
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Requirements for new treaties
Roundtable participants recommended that the government assess the potential risks of arbitration disputes associated with the expansion of gas infrastructure. In their view, future investment treaties should contain clear safeguards for Nigeria's right to regulate environmental protection, pollution remediation, and climate policy without the risk of arbitration claims.
They also proposed reviewing and strengthening provisions of the Petroleum Industry Act concerning environmental remediation, obligations to communities, and regulatory enforcement. Participants called on the Nigerian Upstream Petroleum Regulatory Commission to establish mandatory requirements under which companies, before completing asset divestments, must settle or adequately secure their obligations regarding accumulated environmental damage.
Other recommendations include increasing transparency in investment disputes, public consultations before treaty ratification, a formal role for the National Assembly in their approval and ratification, and abandoning investor-state dispute settlement provisions in future agreements.
