Financial Energy Review
Some stakeholders have backed the moves by Spaces for Change, S4C to develop communities in line with the Petroleum Industry Act, PIA.
The stakeholders, including Nigeria Extractive Industries Transparency Initiative, NEITI, Imo State Government and the Nigerian Upstream Petroleum Regulatory Commission, NUPRC, expressed solidarity during the just-concluded two-day National Extractives Dialogue, NED2023, Host Community Development Trusts, which had “Catalysts for Equitable Benefit-Sharing and Sustainable Prosperity for All” as its theme in Owerri, Imo State,
Speaking at the just-concluded event, hosted by S4C in collaboration with the NEITI and with the support from Fort Foundation, the Executive Director, Victoria Ibezim-Ohaeri, charged communities to seize the opportunities created by The Petroleum Industry Act, PIA to stimulate the sustainable development of their areas.
“In these communities, the earth bequeaths massive treasures—gold, ore, tin, limestone, lead, zinc, baryte, coal, copper, crude, diamond, crude oil and natural gas—that promise prosperity beyond imagination. For several years, these communities have watched as towering rigs and other mechanical installations rose like giants on their horizon; as pipelines transporting mineral resources crisscrossed their fields, and as trucks laden with crude extracted from their backyards rumbled through their streets.
“Native lands, forests, mangroves, trees, rivers and traditional livelihoods shivered under the heavy might of mineral resource extraction while communities raged and begged for a share of the cake baked from the natural resource endowments from mother earth. Not too long ago, transformation knocked gently on the door, in response to the yearnings of local people.”
She said the Nigerian government signed the PIA into law in August 2021, adding that Chapter three of that Act offers a beacon of hope by demanding the creation of the Host Community Development Trusts, HCDTs.
Ibezim-Ohaeri said: “Under Section 240 of the Act, the benefits of natural resources must now flow back to the communities where they came from. Extractive corporations—whether indigenous or international—are now required to contribute 3% of their actual operating expenditure to the Host Community Development Trusts.”
Speaking further, she said, “With a promise to accelerate economic and social development of communities in the petroleum-producing areas, the Act made new arrangements for fostering sustainable prosperity within the host communities; providing direct social and economic benefits from petroleum operations to the host communities; and determined to enhance peaceful and harmonious co-existence between extractive corporations and their host communities. What do these new arrangements mean? It means that host communities now have the right to benefit from natural resources tapped from their backyard.
“And these benefits according to her are no longer acts of corporate benevolence, but an entitlement to partake in the design, content and structure of their own development, and most importantly, participate in the governance and administration of petroleum resources through their membership of either the Board of Trustees, the Management Committees or any of the advisory bodies created under the Act.
“The failure of a company to comply with these requirements is a ground for revocation of National Extractives Dialogue, NED2023, Host Community Development Trusts: Catalysts for Equitable Benefit-Sharing and Sustainable Prosperity for All their License or Lease. As if these assurances are not enough, the PIA gave birth to the Nigerian Upstream Regulatory Commission (NUPRC) entrusted with overseeing the implementation of HCDTs.
“What the PIA has simply done is to create the right of host communities to benefit from natural resources. It means that host communities have moved away from an era of charitable developmental assistance to a new era of entitlements and human rights.
“To give life to these promises, SPACES FOR CHANGE has consistently monitored policy implementation at the grassroots, generated knowledge products, shared information, and engaged most of the host communities gathered here today to empower, sensitize and channel their concerns to the appropriate target agencies and corporations.
“At the core of our gathering today lies a profound concept—that Host Community Development are not just legal constructs; they are instruments of change, vehicles for hope, and beacons of progress.
“They represent a fundamental shift in how we view, engage and manage natural resources in Nigeria. They are the keys that unlock the door to equitable benefit-sharing ensuring that prosperity becomes the birthright of every member of our community, and not the privilege of a select few.”
She also said: “They serve as a bridge connecting the aspirations of host communities with the operations of extractive industries. It is against this backdrop that stakeholders in the extractive industry from Nigeria and Ghana have gathered here today, to collectively evaluate the progress that has been made in establishing Host Community Trusts in all areas where oil and gas extraction takes place”, she pointed out.
“Our discussions over the next two years will delve deep into critical matters related to the implementation of HCDTs such as the governance structure and management, funding mechanisms, equitable benefit-sharing and implementation, community participation, project adaptability, monitoring and evaluation, conflict resolution, participatory needs assessment, long-term investments options for communities and intergenerational roadmaps”.
The theme of this year’s National Extractives Dialogue, NED, 2023 titled, ‘Host Community Development Trusts: Catalysts for Equitable Benefit-Sharing and Sustainable Prosperity for All,’ according to her is not merely words on paper.
She said: “It is the clarion call for change, a call that resonates with every heart present here today. Therefore, as we commence these two days together, SPACES FOR CHANGE and the Nigeria Extractives Industry Initiative, NEITI, invite each and every one of you, our dedicated participants, to lead the way in our journey with the reminder that the ability to enact real change resides within us all.”
“Over the next two days, we stand on the threshold of transformative discussions, the forging of connections, and the realization of shared aspirations. With open hearts and minds, let us embrace the promise of equitable benefit sharing, sustainable prosperity, and a brighter tomorrow. With unwavering determination”, noted the Director.
Similarly, the Executive Secretary, NEITI, Dr. Orji Ogbonnaya Orji, said: “My presence in Owerri and at this event to support Spaces for Change is in furtherance of our partnership and collaboration with civil society organisations to deepen implementation of EITI at sub-national levels.”
Also speaking, the Commissioner, Ministry of Petroleum Resources, Imo State, Professor Eugene Ukachukwu Opara, said: “Extractive companies within our rural communities were operating under what they coined as Global Memorandum of Understanding (GMoU) as it relates to dealings with their host communities.
“Until S4C intervention, Assa North Ohaji (ANOH) host communities signed GMoUs without having external contacts with other organizations and situations that could give them sound legal advice and alternative information that could enrich the quality of negotiations with extractives companies. A negotiation with unequally endowed or unbalanced teams can be exploitative.”
However, the Commission Chief Executive (CCE), Nigerian Upstream Petroleum Regulatory Commission, NUPRC, Engr. Gbenga Komolafe, who was represented by the Regional Coordinator, NUPRC, Owerri, A. M. Uviovo, said: “The communities are therefore advised to take ownership of the facilities located in your domain to enable you to obtain the maximum benefit of the provision of Petroleum Industry Act (PIA), 2021.”
