The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says 172 Host Communities Development Trusts (HCDTs) have so far been incorporated by oil and gas companies operating in the country.
Gatekeepers News reports that the commission said the trusts were established in line with provisions of the Petroleum Industry Act (PIA), which requires oil and gas companies, known as settlors, to contribute three percent of their operating expenditure (OPEX) from the preceding financial year to a host communities trust fund.
Oritsemeyiwa Eyesan, chief executive officer (CEO) of the NUPRC, disclosed this when she received the leadership of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in Abuja.
Eyesan said the commission had put procedures and regulations in place to ensure compliance with the PIA, particularly provisions governing host communities and the obligations of operating companies.
“We have laid out procedures for doing things and we have put regulations in place to streamline the process. So far, we have registered 172 HCDTs and we have been able to manage contributions by settlors,” she said.
According to the NUPRC boss, the trusts have financed the construction of schools, hospitals and other infrastructure in host communities, helping to promote peace and stability in areas that were previously affected by unrest.
She added that improved relations between oil-producing companies and their host communities had also contributed to increased oil production.
Eyesan, however, acknowledged that some HCDTs are facing litigation over disagreements surrounding the constitution of their boards of trustees.
She said the NUPRC was working to resolve the challenges and ensure that the trusts function effectively in the interest of the country.
The commission’s alternative dispute resolution centre, she added, has also played an important role in addressing grievances involving host communities and other stakeholders.
While appreciating RMAFC for its interest in host communities, Eyesan stressed that oversight of the management of HCDT funds remains the exclusive responsibility of the NUPRC.
She, however, promised to investigate the lingering disagreement between Sterling Oil Exploration and Energy Production Company (SEEPCO) and its host community in Anambra State.
Earlier, Mohammed Shehu, chairman of the RMAFC, commended the NUPRC for its role in driving reforms in the upstream oil and gas sector, which he said had contributed to increased production.
Shehu described the upstream sector as critical to the Nigerian economy because it contributes significantly to revenue accruing to the federation account.
He thanked the NUPRC leadership for honouring the commission’s invitation and called for stronger collaboration between both institutions to advance the country’s interests.
