PIB: Group Urges Review Of Host Communities Fund

An Environmental Rights Group, has called for the review of the petroleum host community fund in the Petroleum Industry Bill (PIB) before the National Assembly.

Mr Nelson Nwafor, the Executive Director, Foundation For Environmental Rights, Advocacy and Development, made the call in an interview with The Tide on Thursday in Aba.

The Tide reports that the fund is a pool where upstream companies remit 10 per cent of their net profit for the development of the oil producing communities.

Nwafor said that there was the need to know who would control the fund because some stakeholders in the industry may not support.

According to him, some upstream companies may shun the proposal if they consider it will stifle their business operations.

He decried the high level of corruption in the oil sector, especially the various reports on petroleum subsidy scam.

“With the kind of the corruption in the sector, it will be difficult to deploy the fund for the purpose for which it is meant.

“The proposed bill also failed to indicate who will represent the communities in the board to ensure effective community representation.”

Nwafor stressed the need to enthrone transparency and accountability in the process and urged for the constitution of state and local government boards to oversee the disbursement of the funds to the communities.

He argued that the community representative should not be a politician to avoid the hijacking of the process and called for clear definition of the oil producing communities and pipeline across communities to know the percentage of the derivation and payments entitled to each community.

He frowned at Section 127(4), which states that where there are damages to the oil facilities situated in a community, such community would forfeit its entitlement of the fund.

“This proposal, which tends to hold oil communities responsible for sabotage, should be expunged from the PIB.

“It does not justify government sincerity to the plights of the host community because oil theft is being perpetrated by other stakeholders and highly placed persons in the industry.

“Recent reports by the Joint Task Force in the Niger-Delta area testify to this. It will be a great injustice to the communities if such proposals are implemented.”

Nwafor, however, lauded the introduction of the fund because it would help to stabilise oil production while the oil producing communities would be effective stakeholders in the oil business.

“They would fight sabotage because doing otherwise will negatively impact on them directly.

“It will also promote justice and fair play; a case where something is given back to those whose resources sustain the nation will surely ensure peace and harmony, he stressed.