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How Petroleum Industry Act Affects Oil Communities – Don



How Petroleum Industry Act Affects Oil Communities - Don
Dr. Hilary Owamah

A university teacher, Dr Hilary Owamah, has shed light on the key provisions of the new Petroleum Industry Act (PIA) passed into law in August, 2021 by President Muhammadu Buhari.

The Associate Professor of Civil & Environmental Engineering spoke at a one-day sensitization workshop organized by the Delta State Ministry of Oil and Gas, at the Prof. Chike Edozien Secretariat on August 9, 2022.

Speaking on the theme “The PIA – How Best can the Host Community Manage it for Maximum Benefit?” Owamah, who is currently the Director of Academic Planning at the Delta State University, Abraka and a Fellow of the Nigerian Society of Engineers, said that the aim of the PIA was to create an environment more conducive for growth of the oil and gas sector and to address the legitimate grievances of communities most impacted by extractive industries. He noted that the relationship between host communities (HC) and oil companies, over the years, has not been cordial.

Owamah did inform the participants, which comprised mainly representatives of oil companies and their host communities in Delta State that the hostilities may have contributed to the massive theft of crude oil, vandalization of pipelines and the incessant shutdown of major oil fields.

According to the guest speaker, “the problem could have been the reason the Nigerian government is unable to meet its OPEC crude oil production quota of about 1.8 million barrels per day in recent times”.

Dr Owamah highlighted some of the earlier initiatives undertaken by government to address the issue such as the setting up of the Derivation Fund – funded with 13% of oil revenue from the Federation Account and paid to oil-producing states, creation of the Niger Delta Development Commission (NDDC) in 2000–funded with NDDC Levy of 3% of total annual budget of oil-producing companies, creation of the Ministry of Niger Delta Affairs in 2008, with the total budget allocation of about N584.6 billion between 2008 and 2022 and the Amnesty Programme to Niger Delta Militants in 2009.

He noted that it was the inability of these initiatives to address the frosty relationship between host communities and petroleum companies that led to the promulgation of the Petroleum Industry Act (PIA) which has now introduced the requirement for specified petroleum industry operators to establish a Host Communities Development Trust Fund (HCDTF).

Owamah noted that the PIA overhauls the regulation and governance of the oil and gas industry by providing for two regulatory agencies, which are the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority, (NMDPRA) responsible for the regulation of their respective sectors in the petroleum operations, and can sue and be sued in their own name.

On the key provisions of the PIA, Owamah said that regrettably, the PIA provides that 30% of the profits of the NNPC Ltd will be used to finance exploration in other basins in the country, called the “Frontier Exploration Fund”.

Another provision of the PIA which aims to address the frosty relationship between oil companies and host communities is the creation of the Host Community Development Trust Fund (HCDTF), whose purpose will be to foster sustainable prosperity, provide direct social and economic benefits from petroleum to host communities, and enhance peaceful and harmonious coexistence between licensees or lessees and host communities.

According to Owamah, the HCDTF is a fund to be set up for the benefit of communities situated in or appurtenant to the area of operation of petroleum companies or operators to cater to the infrastructural development and economic empowerment of host communities.

The guest speaker also clearly stated that in incorporating the HCDTF, the operator would consult with the host communities to appoint a board of trustees and apply to the Corporate Affairs Commission (CAC) for registration of the HCDT.

In his words, “the management of the HCDTF is the responsibility of the board of trustees, management committee, and the advisory committee”

Owamah told the settlors and HC representatives present that while the operations of the HCDTF would be governed by the provisions of the PIA, the Companies and Allied Matters Act, regulations issued by the regulators and the constitution of the HCDTF, the operator is required to oversee the activities of the board of trustees and committees of the HCDTF, the funds and expenditures of the HCDTF.

READ ALSO: Ministry Inaugurates Technical Committee On Petroleum Act

Owamah made the audience to know that for upstream operations, the HCDTF is to be funded with 3% of the operator’s annual operating expenditure of the preceding year. He also mentioned other sources of fund for the HCDTF as donations, grants or honoraria, and any profit and interest accruing on reserve funds of the HCDT.

“Funds made available to the HCDT are to be used exclusively for the development of the host communities in accordance with the Host Community Development Plan (HCDP) prepared by the operator and approved by the NUPRC (the Commission) or the Authority as the case may be”.

Owamah said that in preparing the HCDP, the operator is required to conduct needs assessments in the host communities and determine the effect of the petroleum operations, the strategy to be adopted and the projects to undertake to meet the communities’ needs.

According to Owamah, the HCDT funds are to be utilised as follows: 75% to be allocated to execution of projects, 20% to be reserved for investment, and no more than 5% is to be allocated for the administrative cost of running the HCDT.

Funds spent on projects are to be accounted for by the operator and the board of trustees of the HCDT. The don further elucidated that the PIA provides that where there is sabotage or vandalism to petroleum installations or designated facilities within a host community, that community shall forfeit, to the extent of the cost of the repairs, its entitlement under the HCDTF as such creates a sense of responsibility for the safety of petroleum installation and facilities within host communities. The provisions for environmental degradation fund and others were also mentioned by the guest speaker. The event was chaired by the Honourable Commissioner of the Delta State Ministry of Oil and Gas, Prince Emmanuel Amgbaduba with the Permanent Secretary of the Ministry, Mrs Gladys Aghogho Puegeren in attendance.


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Abiodun Seeks US Partnership In Developing Critical Sectors



Ogun State Governor Dapo Abiodun

The Ogun State government has solicited for partnership with the United States of America in developing the critical sectors of the State’s economy.

The State Governor, Prince Dapo Abiodun who stated this when he received the American Consul General to Nigeria, Mr. Will Stevens, who led a 5-man delegation on a courtesy call in his office at Oke-Mosan Abeokuta on Wednesday, noted that the State considers the United States as a progressive partner in the areas of economy, good governance, security, climate change and human capital development around the world.

Governor Abiodun posited that the State apart from the sophistication of its people and their cognitive political culture, is unanimously and popularly adjudged as the New Jersey of Nigeria and the leading industrial hub in the West Africa Sub-region, hence the need to tap from the American experience to further its developmental stride.

The governor said his administration at inception in 2019, assembled a team made up of highly resourceful technocrats and cerebral policy architects and conceptualized a transformational philosophy coined ISEYA, which is an acronym for Infrastructural Development, Social Welfare and Well-being, Education and Human Capital Development, Youth Empowerment and lastly, Agriculture and Food Security.

He said: “Through this concept, we have strategically transformed the state with modern infrastructure, deliberate policy steps to attract businesses and moving the economy from being federal allocation-focused to becoming the state with the third largest Internally Generated Revenue in the country.

“The State’s strategic location as the primary gateway to Lagos State – the largest market with the busiest ports in Nigeria has contributed to its status as the Industrial Hub of Nigeria.

“Our State is home to one of the largest industrial zones in Sub-Saharan Africa, which includes the 8,000 hectares OPIC-owned Agbara Industrial Estate, which accommodates the Federal Ogun-Guangdong Free Trade Zone (OGFTZ), with forty-four (44) operational companies, factory tenants from across the world, with over 6,000 Nigerian employees and an estimated 100,000 metric tons of freight moving in and out daily.”

Prince Abiodun noted that in its quest to make Ogun State the first destination for investors in Nigeria, his administration is currently constructing an Agro Cargo International Airport at Iperu-Ilishan road in Ikenne Local Government Area of the State, adding that the project is strategically designed to create the needed infrastructure to boost the exportation of agricultural and non-agricultural goods.

“By its structure and business plan, the Cargo Airport remains a game-changer in our import and export promotion efforts, as it was specifically constructed to be an aerotropolis (Airport City) equipped with components such as a special agro-processing zone to process raw agricultural materials for exports, an international testing centre to certify that agro-produce complies with international standards before it is exported, and facility for passenger operations as well as facilities to receive parcels coming into Nigeria that are to be redistributed to other parts of the country.

“In addition to that, it is an important component of Ogun State’s transportation master plan expected not only to connect rail, road and water transportation but also to decongest the Lagos Airport,” the governor added.

Governor Abiodun appreciated the American government for her firm stance on democratic governance, specifically on the sanctity of the electoral process as well as supporting different reforms in the electoral process and taking an uncompromising position on electoral offenders.

In an interview after a closed-door meeting with the governor, the Consul General said their discussions centred on security and health.

He noted that health remains the number one investment in Nigeria as the US government is in the health sector to help Nigeria to reach the 95 95 95 goals of ending the HIV/AIDS epidemic in the country.

“It is my job to promote US trade and investment here in certain parts of Nigeria. I had a great conversation with the governor about the incredible investment the US companies are already making in the state as well as opportunities for more increased US trade and investment.

“We also talked about the tax sector, I think there are incredible opportunities right now to find jobs and opportunities for Nigerian youths to participate in the tax sector.

“We’ve seen the explosion of growth and investment in that sector throughout Nigeria, particularly in the South West,” the Consul General added.

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BREAKING:Chicago State University Unable To Grant One Request By Atiku As It Releases Tinubu’s Academic Records



Senator Withdraws Support For Tinubu Over Choice Of Muslim Running Mate
President Bola Tinubu

The Chicago State University (CSU) was unable to meet one request by the People’s Democratic Party (PDP) Presidential Candidate Atiku Abubakar as it finally released to him the academic records of President Bola Tinubu.

Atiku requested the documents to back his allegation of forgery of CSU certificate against Tinubu. It would mean Tinubu was not qualified to run for the election, which he won, if the allegation is successfully proved against him.

The university, on Monday, presented to Atiku’s legal team, a cache of documents connected to Tinubu’s education at the institution and copies of certificates with redacted names issued to other persons about the same time the Nigerian president finished from the school in 1979.

It also contained Tinubu’s admission records, and a letter dated 27 June 2022 confirming that he attended the university from August 1977 and June 1979 majoring in accounting. The letter said Tinubu was awarded Bachelors of Science in Business Administration with Honours on 22 June 1979.

The District Court in Northern Illinois, had in its judgement delivered on Saturday, given the university up till 12 noon on Monday to deliver the documents to Atiku.

The judge, Nancy Maldonado, gave the other after dismissing Tinubu’s objection in the judgement.

Ms Maldonando dismissed Tinubu’s objection to the 20 September decision of a magistrate judge of the court, Jeffery Gilbert.

The judge fully affirmed Gilbert’s ruling, ordering the CSU to release Tinubu’s academic records as requested by Atiku. She insisted Atiku had the right to have access to the records.

Complying with the court order on Monday, the university produced four sets of documents copies which went viral online on Monday.

In a deposition detailing its compliance with the court order, the university confirmed it was able to grant three of Atiku’s four requests.

Responding to one of the requests it granted, the university said, “after diligent search”. it was able to locate and produce seven different certificates for Bachelor of Science degree it issued in 1979.

Atiku had apparently requested the documents to compare and contrast them with the one presented by Tinubu as his for the 2023 presidential election.

The university also handed to Atiku’s team, documents relating to Tinubu and certified by an official of CSU, Jamar C. Orr, a lawyer.

The university similarly produced, “after diligent search”, copies of three other diploma certificates issued to other students other than Tinubu in 1979.

This was in response to Atiku’s request for “true and correct copies of any diplomas issued by CSU (other than to Tinubu) that contain the same font, seal, signatures, and wording (other than the name of the recipient and the specific degree awarded)”. Atiku sought these documents to compare and contrast them with the one Tinubu claimed to have obtained on or about 22 June 1979.

But the university said it was unable to locate “a copy of the original diploma it prepared for Tinubu in 1979” as requested by Atiku.

This was the kernel of Atiku’s request which is at the heart of the issue he intends to use the documents for in his legal challenge of Tinubu’s victory at the 25 February presidential election.

The university said it “does not in the ordinary course keep copies of student diplomas, and after diligent search cannot locate a copy of the original diploma it prepared for Mr. Tinubu in 1979, hence has no documents responsive to this request.”

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Group Commends Ogun Governorship Election Petition Tribunal’s Verdict



Ogun State Governor Dapo Abiodun

A Civil Society Organization, Advocacy for Peace and Good Governance, has commended the Ogun State Governorship Election Petition Tribunal for its verdict on  the March 18, governorship election in the State.

It would be recalled that the tribunal, on Saturday, unanimously validated the victory of Governor Dapo Abiodun, as it dismissed all the grounds canvassed by the Peoples Democratic Party (PDP) and its candidate, Ladi Adebutu in their petitions.

The group stated that the verdict was a victory for democracy and affirmation of the people’s choice.

The group, in a statement signed by it’s National Coordinator, Waheed Sulaimon, on Saturday in Abuja, described the judgement as explicit without any ambiguity, saying it was a true reflection of what happened across Ogun State on March 18, 2023.

The group noted that the tribunal delivered its verdict based on the facts and evidence presented before it, as well as the credibility of the electoral process.

It lauded the judiciary for its impartiality in the ongoing election petition-related cases across the country, adding that Nigerians have always reposed their confidence in that arm of government.

The group, therefore, urged all parties involved to accept the decision of the tribunal and join hands with Governor Dapo Abiodun, to work towards the development of the state.

It also called on all stakeholders in the Ogun State project to rally round the governor to make the Gateway State among the best in Nigeria in terms of economic prosperity, political stability and social cohesion.

The group also lauded Governor Abiodun for his commitment to good governance and efforts at ensuring the security of lives and property, as well as his unwavering political will to speedily develop the state.

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