PIA: Oil companies owing host communities N1tn, says HOSTCOM

The Host Communities Producing Oil and Gas has expressed concern that two years after the Petroleum Industry Act 2021 took effect, host communities in the Niger Delta had not started receiving benefits from the three per cent of oil companies’ operational cost prescribed by the law.

The National President, HOSTCOM, Benjamin Tamaramiebi, said this during a press briefing in Yenagoa, Bayelsa State capital, while reacting to some media reports suggesting that host communities were against the Nigerian Upstream Petroleum Regulatory Commission getting involved in the day-to-day management of the trust fund.

Former President Muhammadu Buhari signed the Petroleum Industry Bill into law in August 2021.

The PIA provides legal, governance, regulatory and fiscal framework for the Nigerian petroleum industry, the development of host communities, and related matters.

The host community trust fund created by the PIA was meant to be administered by the oil and gas companies in collaboration with the host communities.

Tamaramiebi lamented that oil firms operating in the Niger Delta had not remitted three per cent of their annual production costs to the trust fund as prescribed by the law.

He claimed that the accumulated unremitted three per cent had amounted to N1 trillion.

He said, “It is sad to say that after two years of the enactment of the PIA in 2021, the operating companies failed to provide the meagre three per cent of their annual production cost to the host communities.

“What is the fate of the communities at the moment? From my assessment, from 2021 till date, over N1 trillion, if converted from $500 per year, which is about $1 billion, is owed to the host community development trust fund.

“This is what is supposed to come into the host community development. But that has been denied the communities.”

Tamaramiebi complained that all global Memorandum of Understanding and the MoU that the oil firms used to sign with host communities through cluster development boards had been suspended and attention shifted to the PIA.

“But because of the PIA, the GMoUs and MoUs were suspended. The companies were using these documents for the development of host communities by grouping communities into clusters of development boards.

“With these, they were given the communities peanuts for cluster projects. With the signing of the PIB into law, all such were suspended and they were asked to implement the provisions of the law,” he said.

The HOSTCOM leader, however, explained that the NUPRC was not involved in the management of the host community development trust fund, stressing that the commission’s involvement was in regulatory

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