EVALUATING THE INTERNATIONAL ARBITRATION OF OIL AND GAS INVESTMENT DISPUTE SETTLEMENT IN NIGERIA

Abstract

• Abstract
  This paper examined international arbitration as a tool for resolving investment disputes in Nigeria’s oil and gas sector, a critical industry that contributes significantly to Nigeria’s Gross Domestic Product (GDP), foreign exchange earnings and government revenues. This sector is marked by high-risk investments and complexity and often faces disputes arising from regulatory changes, fluctuating global prices, environmental concerns and contractual breaches. Arbitration, particularly in cross-border investments, provides a neutral, efficient and flexible mechanism for resolving such disputes. Using a doctrinal research methodology, the study analysed statutes, case law, international treaties, and academic sources. Findings revealed that while arbitration offers benefits such as neutrality and enforceability, there are still some challenges that must be addressed as a matter of urgency. Issues include resistance to enforcement of arbitral awards by Nigerian courts on grounds of national interest, high arbitration costs and biases favouring foreign investors. Nigeria’s legal framework, including the Arbitration and Mediation Act 2023 and the Petroleum Industry Act 2021, supports arbitration but lacks procedural clarity, leading to delays and inefficiencies. The paper concluded that legal reforms are essential to strengthen arbitration processes, enhance enforcement mechanisms and align Nigeria’s framework with international standards. Such reforms would foster investment stability and improve Nigeria’s attractiveness as an investment destination by reducing legal uncertainties. The paper recommended legislative and judicial improvements in order to achieve these goals.