Implementation of HCDT: Sanction Defaulting Settlors Now- CSOs, Media Organisations Tell NUPRC
By Ekemini Simon
Civil Society Organisations (CSOs), Community-based Organisations (CBOs), advocacy groups, and media organisations in Nigeria have called on the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to sanction defaulting oil and gas companies who have failed to incorporate and establish the Host Communities Development Trust Fund 15 months after the August 2022 deadline.
The call was made at a one day workshop on Cost of Corruption in the Extractive Sector organised by BudgIT with support from Oxfam Nigeria and held on Thursday, November 23, 2023 in Rivers State.
The Petroleum Industry Act and the Host Communities Development Regulation provides that when the settlor or operator fails to incorporate the Trust after 12 months period from August 2021 which the Act came to force, the settlor or operator shall be liable to an administrative penalty of $2,500 or its Naira equivalent per day and may face subsequent revocation of license.
NUPRC in its recent report had noted that as at November 2023, out of 206 operational oil and gas companies, there had been 139 submissions for the Host Communities Development Trust, 97 approved and 81 incorporated. Among them, 56 accounts have been created, and 43 funded, leaving an outstanding of 107 despite exceeding the deadline by 15 months.
In a communique signed by BudgIT, Oxfam, Policy Alert, TheMail Newspaper and 19 other organisations, issued at the end of the workshop, the organisations noted that with many settlors defaulting on the provisions of the PIA and yet to set their Trust for the communities where they operate, the sanctions provided in the act and HCDT must be implemented.
They said this will curb corruption and guarantee that Host Communities are subsequently no longer deprived of their due benefits as the PIA–HCDT provides and that the government is not running at loss by not bringing such defaulters to book through the negligence of lawful sanctions as stipulated in the PIA.
The organisations asked that in line with the HCDT regulations, communities must be included in the process that produces the Trustees of the Trust, hence no one is forced on them.
They asked that every step in the process be made transparent, credible, and inclusive. “The process must be collaborative, and every host community should know about and affirm the characters that must represent their interest in running the HCDT”, the communique read.
The organisations, while noting several non-inclusion of the communities in the design of community development plan for the HCDTs, said there is a need for settlors to work with the prevailing needs of Host Communities to deliver the benefits of the HCDT intervention.
They pointed out that where communities are not consulted on pressing demands within their environment, the HCDT efforts become a waste of resources hence, before embarking on any HCDT project, an inclusive community’s needs assessment must first be done.
The organisations further asked that there should be inclusion of Women and People with Disabilities in the HCDT Trustees.
The communique added “While the inclusion of women and people with disabilities in the HCDT thus far is commendable in some communities, it remains a concern that this demography is often neglected or generally sidelined in the leadership selection process of Host Communities Trustee membership. The participants advocated for a change to this to create a balanced HCDT leadership that plays on inclusion and equality.”