Carbon Markets and Nigerian Petroleum Law: Analytical Assessment of Legal Readiness for Carbon Credits from Oil and Gas Operations

This study analytically assesses Nigeria's legal readiness for developing carbon credit markets linked to petroleum sector activities, including gas flare reduction, methane capture, and carbon capture and storage initiatives. International carbon markets, particularly voluntary carbon markets and the Article 6 mechanisms of the Paris Agreement, offer Nigeria potential revenue streams that incentivise emission reductions within its petroleum sector. Using a doctrinal analytical methodology, the research examines the Climate Change Act 2021, the Emissions Trading Scheme regulations proposed under the Act, relevant PIA 2021 environmental provisions, and Nigeria's NDC carbon reduction commitments. Comparative analysis draws on carbon credit frameworks applicable to the petroleum sector in Mexico and Indonesia. Findings indicate significant gaps in Nigerian law regarding carbon credit ownership, double-counting prevention, and the legal status of carbon removal from petroleum-related activities. The study recommends enacting a Carbon Credits (Petroleum Sector) Regulation under the Climate Change Act and establishing a national carbon registry aligned with Article 6.4 mechanisms. Keywords: carbon markets, petroleum law, carbon credits, Nigeria, Article 6.