By: Goodluck E.Adubazi, Abuja.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has disclosed that 172 Host Community Development Trusts (HCDTs) have so far been incorporated by oil and gas companies operating in the country.
The Commission also said it had been managing contributions by oil and gas companies, known as settlors, in line with the provisions of the Petroleum Industry Act (PIA).
NUPRC Chief Executive Officer, Engr. Gbenga Komolafe, disclosed this when he led a delegation of the Commission on a visit to the leadership of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in Abuja.
Under the PIA, oil and gas companies are required to contribute three per cent of their operating expenditure (OPEX) of the preceding financial year to a Host Communities Trust Fund for the benefit of their host communities.
The NUPRC said it had established procedures and regulations to ensure effective implementation of the provisions of the PIA relating to host communities and the obligations of oil and gas operators.
The Commission stated that the 172 registered HCDTs had supported the development of schools, hospitals and other critical infrastructure in host communities, contributing significantly to peace and stability in areas previously affected by unrest.
According to the Commission, improved relations between oil-producing companies and host communities have also contributed to increased oil and gas production.
While acknowledging that some HCDTs had become subjects of litigation arising from disagreements over the constitution of their Boards of Trustees, the NUPRC said it was working to resolve the challenges and ensure that the trusts operated effectively in the national interest.
The Commission further disclosed that its Alternative Dispute Resolution Centre had played a significant role in resolving grievances and disputes involving host communities and other stakeholders.
The NUPRC also clarified that oversight of the management and administration of the HCDT funds remains within its statutory mandate.
The Commission, however, pledged to investigate the lingering disagreement between Sterling Oil Exploration and Energy Production Company (SEEPCO) and its host community in Anambra State.
In his remarks, RMAFC Chairman, Dr. Mohammed Bello Shehu, commended the NUPRC for its reforms in the upstream oil and gas sector, noting that the measures had contributed to increased production.
Shehu said the upstream sector remained critical to the Nigerian economy, particularly because of its significant contribution to revenues accruing to the Federation Account.
He thanked the NUPRC leadership for honouring the Commission’s invitation and called for stronger collaboration between the two institutions to enhance revenue generation, transparency and development in the oil and gas sector.
The RMAFC Chairman stressed that closer cooperation between both agencies would be in the overall interest of the country.
