Petroleum Institutions

7. Environment ministry

Petroleum activities are often associated with significant environmental and social ‘footprints.’ Addressing the issues arising from those footprints may be the responsibility of the petroleum sector ministry, but good practice would recommend that responsibility go to specialised ministries like the environment ministry and ministries dealing with labour and local community matters. In this case, good practice would also recommend that a small unit be established within the petroleum sector ministry to coordinate with the specialised environmental and social issue ministries.   

The environment ministry is normally responsible for approving environmental impact assessments prior to exploration and environmental audits during the exploration and development stages. The ministry would also be responsible for ensuring compliance with emission and discharge standards.

The importance of the environmental ministry in the petroleum sector will be even greater in the future, as a result of the Paris Agreement on Climate Change, which was signed by 195 countries and the EU in December 2015, and ratified by 115 countries in October 2016. Under the Paris Agreement, member countries have committed to the goals of keeping global temperature rise at below 2 degrees Celsius above pre-industrial levels, and to pursuing efforts to limit increases even further to 1.5 degrees Celsius above pre-industrial levels. This will be achieved through an ambitious reduction of greenhouse gas (GHG) emissions (through nationally determined contribution (NDCs) and having a stock-take every five years, the first one being in 2023. Environmental ministries will be central to formulation of country-specific regulatory and policy changes, and monitoring and enforcement.