This study explore ways of resolving oil and gas disputes especially environmental issues such as oil spillage, gas flaring, effluent discharge etc that create environmental degradation using Alternative Dispute Resolution, ADR mechanisms. The concept of ADR has its origin in African laws, thus is not alien to African people. The study exposes the limitation in environmental litigation through the courts in the oil and gas sector in Nigeria. The limitations are as a result of numbers of factors the most significant being the over bearing influence of the multinational corporations; the enormous support they enjoyed from the Federal Government; weak statutory provisions and limitation of the common law in tackling environmental problem. The study adopted the qualitative methodology in the gathering and analysis of it data. The study examined key legislations on environment guiding the operation of the Nigerian oil industry, case laws and common law principles applicable to the environment and environmental litigation in the Nigerian context. The study also gathered data through the instrumentality of semi-structured interview and focus group discussion with community leaders, environmental activists, alternative disputes resolution practitioners and employees in selected oil multinational corporations in Nigeria. The core problem that informed this study is the examination of the problem of environmental degradation arising from the operation of the oil industry and the associated crisis of neglect, marginalization, loss of livelihood and poverty in the Niger Delta. The core objective of the research is to explore how environmental degradation associated with the operation of the Nigerian oil and gas industry in the Niger Delta has generated endemic systemic conflict and to examine the efficacy of the various initiatives taken by the Nigerian State and the oil multinationals in resolving environmental based and related conflicts in the oil producing areas. The significance of the study lies in its attempt at highlighting the importance of ADR as the most amicable, economical and speedy way of settling disputes that often arise in the course of the operational activities of the oil and gas industry in the Niger Delta. The point being that such disputes deserves to be quickly and speedily resolved via the instrumentality of ADR in order to avoid the destabilization that might arise through long drawn court litigation. The literature confirmed grave environmental devastation in the Niger Delta and the inability of adversarial litigation in ensuring environmental justice in Nigeria. The findings show that there is increasing incidence of disputes that arise out of environmental concern between communities and companies in the region. These disputes are made worse by the failing inability of the court system to deliver environmental justice to claimants in the area. This failing inability is as a result of corrupt practices, obnoxious government policies, fraudulent practices among community leaders, unruly behaviour of multinational oil companies, attempts at avoiding culpability through dubious legal means among other issues. This has hindered efforts at achieving sustainable peaceful community-companies relations. This in turn has led to confrontation between host communities and companies over the control of natural resources and sustainable use of the environment. According to findings of this study litigation has failed the people in the Niger Delta in their struggle for justice. This is also corroborated by existing literature on the issue. Hence ADR is therefore, considered as the best alternative nonadversarial methods of resolving environmental and other related disputes in the Nigerian oil and gas industry in addition to the use of faith based principle if properly implemented.