PIB: Sylva Faults Host Communities’ 10% Trust Fund Demand
The Minister of State for Petroleum Resources, Timipre Sylva, has faulted the position of host communities who are insisting on collecting 10 per cent of the operating expenditure of the oil firms to set up a trust fund.
The leaders of the oil rich areas under the aegis of the Host Communities of Nigeria Producing Oil and Gas, had on Tuesday, openly rejected the 2.5 per cent proposed for them in the Petroleum Industry Bill 2020, being considered by the joint Senate Committee on Petroleum Resources, (Downstream, Upstream and Gas).
They insisted that nothing short of the 10 per cent of the operating expenditure they were demanding would be acceptable to them because the proposed 2.5 per cent was grossly inadequate to provide basic social amenities and improve the standard of living of their people.
But the Minister, who spoke with journalists after the end of a two-day public hearing on the proposed bill by the Senate panel on Tuesday, faulted the argument of the oil communities’ leaders.
He said, “The 2.5 per cent as proposed in the bill is fair and of course, I speak as a member of the host communities myself.
“If you have to look at it properly, you will see that 10 per cent in profit is different from 10 per cent of the OPEX (operating expenditure).
“Before now, you had a provision of 10 per cent of profit for the host communities but we discovered that if the oil firms do not declare it, host communities won’t have anything.
“But in this case, it is 2.5 per cent of the operating expenditure. So, at the end of the year we will calculate the operating cost and take the 2.5 per cent of that cost to the budget of the next year.
“Of course, I don’t like to discuss details of the bill at this point because these are just proposals before the National Assembly.
“Until it is passed, we cannot discuss it but since it came up here, I thought I should just mention it.
“As far as we are concerned, we have made a very fair proposal – fair to the host communities, fair to the country and fair to the oil companies.
“We have put this bill before the National Assembly and they have the competence to look at it and pass it the way they see fit.
“So, at this point I do not want to go into detailed aspect of the bill. The bill is before them and we are happy with the progress.
“As you heard the Senate President say yesterday, we expect that this bill would be passed at the end of this quarter or early next month.”
Leaders of the Host community of Oil Producing Areas also called on the Federal Government to scrap the Niger Delta Development Commission and transfer all its allocations to the them for effective management.
The President of HOSTCOMS, High Chief Benjamin Tamaranebi, stated this while addressing journalists.
He said with the reduction of host community development trust fund from 10 per cent in 2008 to 2.5 percent in 2020 PIB, the proposed document would deny the people of the required funds to develop their areas.
Tamaranebi said the NDDC should be scrapped so that the allocation being given to the commission could be directly paid to HOSTCOMS for critical interventions especially after the revelations that followed the investigative hearing on the commission.