Oil Companies Remit N57bn to Host Communities
Oil and gas companies operating in Nigeria remitted a total of N57.07bn to Host Community Development Trusts in 2024, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has disclosed.
The figure was contained in a report of the commission obtained on Monday. The report stated that the fund represents three per cent of the actual annual expenditure of the oil firms for the preceding year, in line with the Petroleum Industry Act.
The report noted that this brought the total contributions made so far to the Host Community Development Trusts to N65.15bn if added to the N8.45bn remitted in 2023.
NUPRC stated that a total of 207 applications for Host Community Development Trusts were received, of which 154 Trusts were approved, and 136 were successfully registered with the Corporate Affairs Commission.
On project management, the report disclosed that 32 fund managers were approved to oversee fund disbursement and that 187 projects were ongoing across the various Trusts.
It also highlighted that the development and integration of the Commission’s digital portal, HostComply, was ongoing to support compliance tracking, fund allocation, reporting, and dispute resolution.
The commission noted, however, that critical modules on fund distribution matrices, conflict resolution, and ESG performance reporting had not yet been completed.
“Large progress has been made with the development of HostComply. Information and data on the previous portal have been migrated, and observed gaps are being filled progressively.
“Some modules are operational but have yet to be integrated (remittance splitting) while some such as Dispute resolution and conflict management are under development.
“The following modules deployment and full integration are still outstanding: fund managers, vendors, conflicts and resolution management, fines and penalties, records and archives, notifications, reporting, incident management, ESG HCDP, OPEX module (calculation, posting and distribution), fund distribution matrix module, HCDT billing/demand notice/sabotage value modules, workflow approval,” the commission.
Noting the challenges faced last year, the NUPRC said petitions and litigations stalled the incorporation of HCDT and the setup of governance structures.
Another challenge was the delayed deployment of the HostComply portal for the NUPRC HCDA team to use and for other stakeholders.
The Host Community Development Trust is a framework established under the Petroleum Industry Act 2021 to address the development needs of communities impacted by petroleum operations.
It aims to foster sustainable prosperity and peaceful coexistence between licensees and host communities. The HCDT is funded by contributions from oil companies operating in the area, typically three per cent of their actual operating expenditure.
In another development, the commission said 361 contracts and procurements were carried out in 2024. “A total of 170 projects were executed, 1 was terminated, and 190 are still ongoing,” it was stated.
