A lawmaker at the House of Assembly on Wednesday condemned the critics of some provisions in the PIB, saying they lack in-depth analysis.
The Chairman of the House Committee on Media and Public Affairs, Benjamin Kalu, in a statement said the members of the house painstakingly considered all the clauses before arriving at a percentage for the host communities.
He also dismissed the controversy over the definition of host communities.
Kalu said, “On the 1st of July, 2021, both chambers of the parliament went through the clause by clause consideration of the bill in preparation for the third reading, which was a major achievement, although not without a call from the public to explain grey areas appearing discriminatory to the host communities, while claiming that a section of the nation is set up to benefit from both the Host Community Trust Fund as well as the Frontier Exploration Fund.”
“In Section 318 under the interpretation section, ‘host community’ is defined as those communities situated in or appurtenant to the area of operation of a settlor, and any other community as a settlor may determine pursuant to chapter 3 of the bill.
“These are those communities housing the production assets of the settlors (the IOCs) and are compensated for the loss of surface use of land for exploration after the land survey is carried out.
“The IOCs know their hosts at all times. There is zero ambiguity on this, as no settlor will accept to fund those who are not hosting them. Surely, the IOCs have a role to play in determining this, especially when one looks at the provisions of the bill with regard to the host Community Trust Fund and the process of setting up the organisational structure as well as the implementation guidelines as outlined by the bill.”
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He assured Nigerians that the Trust Fund will take care of the host communities, to the exclusion of all others.
“Pipeline routes are not host communities, they are impacted communities under the care of the operators in the course of their operations. It is still not obvious which part of the bill mandated the Host Community Trust Fund to cater for the needs of the ‘impacted communities.’ These divisive propagandist theories should be ignored fully.”
The House spokesman noted that what the executive sponsored bill proposed was an annual contribution of 2.5 per cent of the operating expenditure of the preceding year of the IOCs to fund this, as provided for in Section 240(2), which the House amended based on technical advice to 5 per cent, though the host communities asked for 10 per cent.
“The reason behind our decision is to ensure that the financial burden is not much on the investors in this era of great competition across the sector.
“Since the desire of every investor in choosing the destinations for investment is majorly profit, it presupposes that for our bargaining to be attractive, it should create value for the investors to energise their buy-in.
“The point remains we can’t fund the whole nine yards of exploration and production without the foreign direct investments.
The National Assembly on Tuesday formed a committee to harmonise the differences in the versions of the PIB passed by the Senate and the House.
While the House proposed five per cent share for host communities, the Senate suggested three per cent.
The National Assembly also proposed 30 per cent of the profit of the planned Nigerian National Petroleum Company Limited for oil exploration in frontier basins, which are mostly in the North.
