Delta Diaspora Group Petitions Senate President on Petroleum Industry Bill

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Emmanuel Addeh in Abuja

The Isoko Association of North America (IANA) yesterday called on the National Assembly to expunge what it described as some colonial arrangements in the Petroleum Industry Bill (PIB) currently before the federal lawmakers.

The stakeholders comprising communities in the two Isoko local councils hosting oil exploration and production companies, noted that after a review of the PIB’s chapter on host communities’ development, the bill fell short of promoting a harmonious relationship between the host communities and oil companies.

According to the association, led by its President General, Mr. Obaro Odu; Member, Action Committee, Eloho Otobo; and Secretary General, Prof. Oghenekome Onokpise, the draft bill confers significant decision-making powers on the oil companies in the proposed design and operations of the trust fund.

“We fear that the proposed institutional arrangements are a recipe for tension and conflict rather than harmony, at a time when every effort should be exerted to reduce the potential for friction between the host communities and the oil companies,” the group stated.

It argued that the bill proposes that the host communities’ development trust shall be incorporated within 12 months from the effective date of existing mining leases, designated facilities, and facilities under construction.

This according to them, implied that the actual length of time that the communities would benefit from the trust fund would be less by one year.

“Hence, we propose that the fund be established by the relevant companies after six months,” the group stated.

Although the bill states that the objectives of the host communities’ development trust fund include, among others, financing and executing projects for the benefit and sustainable development of the host communities, the association doubted how this can be realised.

IANA added: “As currently outlined in the draft bill, every “settlor” (oil company) will be required to establish its host community trust fund for each community. This will impose very high transactions costs on the communities and oil companies.

“We propose that the oil companies operating in a particular community establish a joint trust fund to which each company will make the financial contribution of 2.5 per cent of their actual operating expenditures and establish a joint board of trustees to be evenly composed of their representatives and those of the host communities.”

According to the group, the bill also proposes that the board of trustees will be constituted exclusively by the oil companies who are defined as stakeholders and vested with a lot of powers, including making decisions on the determination of projects and allocation of financial resources.

“It is unbelievable that such a “colonial” arrangement could be articulated in a Nigerian PIB,” it maintained.

The group argued that the provision of the bill was deeply disconcerting, stressing that it clearly shows that the federal government is not interested in active involvement of the host communities in the administration of the trust funds.

“We strongly recommend that the board of trustees be evenly composed of the representatives who are selected by the host communities and the oil companies respectively,” the Isoko association said.

On the portion that deals with selection process, procedure for meeting, financial regulations and administrative procedures of the board, among others, the group proposed that these matters should be reserved for consideration by an equally composed board between the host communities and the oil company.

It further called for a joint host community-corporate mechanism for investigating events of vandalism, rather than taking action solely on the basis of the views or assessment of the concerned oil company.