Reps Investigate Non-Release Of 3% Annual Operating Expenditures To Host Communities, Other Infractions By Oil/Gas Producing Companies

By Alkassim Bala Tsakuwa, Abuja

The House has also ordered an investigation into the alleged failure of Oil/Gas producing companies to release 3% of its Annual Operating Expenditures to Host Communities and their refusal to incorporate Host Communities Development Trust Fund under the Petroleum Industry Act, 2021.

This followed the adoption of a motion by Hon. Hart Cyril Godwin at the Plenary on Wednesday.

Presenting the motion, he lamented that, some Oil Companies violate the provisions of Section 236 of the PIA by failing to incorporate the Host Communities Development Trust Fund in their areas of operation within the period stipulated in the Act, while others have bluntly refused to incorporate Host Communities Development Trust Fund as required by the law as at when due.

According to him, most Oil Companies failed to fund the Host Communities Development Trust as incorporated and have not been able to pay the 3% of the actual annual operating expenditures to the Host Communities Trust Fund in the areas of operation.

Hon. Godwin, said, “Failure to fund the Host Communities Development Trust Fund has hampered the development of the host communities where the Companies operate.

“The provision of Section 297 Subsection (1) of the PIA, which makes a breach of the Act punishable with the payment of administrative penalties per day, and for continuous breach and Section 238 makes failure to incorporate a Host Communities Development Trust, a ground for the revocation of a holder’s license or lease”.

The House adopted the motion and mandated the Committee on Host Communities to investigate the failure of the Regulatory Agencies to act decisively, failure of the Oil Companies to release amounts equal to 3% of its annual operating expenditures to host communities and their refusal to incorporate Host Communities’ Development Trust Fund under the Petroleum Industry Act, 2021 and report within four (4) weeks for further legislative action.