Derivation: Host communities lost N44trn to oil states in 22 years – Hoscon

 

…Says new oil legislation will enhance development

By Udeme Akpan

 

THE Chairman, Host Communities of Nigeria, Producing Oil and Gas (Hoscon), Dr. Mike Emuh, Tuesday, said, the direct payment of derivation to States denied the host communities of funds, totalling N44 trillion in the past 22 years.

He said it was the non-payment to the communities that accounted for the underdevelopment of the areas, especially as efforts of many state governments were limited to the capitals.

In a telephone interview with Vanguard, Emuh, who praised President Muhammadu and the 9th National Assembly for their roles toward the emergence of the Petroleum Act in Nigeria, said efforts would be made to amend some unfavourable provisions in future.

 

Specifically, he said: “I want to commend President Muhammadu Buhari for signing the Petroleum Industry Bill, PIB, into law. I also commend the efforts of the 9th National Assembly in getting it passed. It is a good start for the oil communities. I have been asking the communities to accept the new Act, even though we intend to canvass for the ammendment of some provisions, including the section, which gives a landlord status to the oil companies.

“With what the President and National Assembly have done, we have been recognized as the landlords that produce the oil and gas in the nation.

“In the past, because the 13 per cent derivation was given to States, the oil and gas communities, that suffer the negative impact of operations lost about N44 trillion to the States.

“But with the Petroleum Industry Act, 3 per cent of the annual budgets of oil companies, estimated at N500 billion will be directed to the communities.

“We have come a long way in the struggle for justice. Recall that I was physically attacked at the National Assembly in the process of defending the communities.”

The Chairman, who disclosed plans targeted at achieving development, said: “Consultations have started and we are going to work with many stakeholders, experts and professionals in order to change the oil and gas communities into a new Dubai or London.

“Unlike the past when much attention was given to the capitals, we will work with indigenes to positively change the fortunes of their communities. We will stake our resources in infrastructural development, agriculture, and industry, among others.

“The communities should wake up, become more united to take their destinies. They should come up with their Master Plans for development. Unlike the past when such initiatives were driven by the oil companies, the communities are expected to fully take charge.

“I will be going around to hold consultations with not only the oil and gas communities but also the 11 identified impacted states, some of which are located outside the Niger Delta.

“Already, the Niger Delta is one of the peaceful regions in Nigeria, thus promising to provide the right atmosphere for sustainable development.”

 

 

Nevertheless, the Organisation of Petroleum Exporting Countries, OPEC, had Monday, expressed optimism that the new oil legislation would create a conducive environment to oil and gas operations in Nigeria, leading to the realization of 40 billion oil reserves.

In a letter to the President, obtained by Vanguard, Secretary General, OPEC, Mohammad Sanusi Barkindo, had stated: “Indeed, the new law will enhance the Nigerian petroleum industry’s reputation, open the door to new investment, and ultimately strengthen its position to meet the world’s growing demand for energy. The enactment of this legislation is especially timely as the investment outlook becomes clouded by efforts aimed at accelerating a lower-carbon future.”

“Furthermore, the new law will help harness Nigeria’s potential to achieve its programme of raising oil production to 4 mb/d and oil reserves to 40 billion barrels, while also drawing on the country’s vast natural gas reserves to provide clean and efficient energy. In addition, these resources will be vital to supplying world markets with a broad portfolio of energy options, and support global efforts to alleviate energy poverty as outlined in the United Nations’ Sustainable Development Goal 7.”

He had added: “The passage of the PIB by both houses of the National Assembly on 16 July 2021 and your act of signing it into law coincides with another significant milestone in our country’s history – the 50th anniversary of Nigeria’s Membership in OPEC. This golden moment provides a unique opportunity to reflect upon Nigeria’s rise as a global energy supplier and partner. Since the 24th OPEC Conference on 12 July 1971, when Nigeria received a unanimous and enthusiastic welcome as the 11th Member Country of the Organization, our country has come to symbolize Africa’s leadership within OPEC and its pivotal support for the global oil market stability.”

 

Nigeria News Paper