The Revenue Mobilisation Allocation and Fiscal Commission has directed the Nigerian Upstream Petroleum Regulatory Commission to dissolve a disputed Host Community Development Trust within 48 hours.
The directive followed an investigative hearing into the activities of Sterling Oil Exploration and Energy Production Company and the implementation of the Host Community Development Trust under the Petroleum Industry Act.
The hearing was conducted by the commission’s Investment Monitoring Committee at the RMAFC headquarters.
Chairman of the committee and Federal Commissioner representing Anambra State, Ekene Enefe, said the regulator must address concerns raised by the affected communities over the composition and establishment of the trust.
“We are going to give you 48 hours to dissolve that host community development trust,” Enefe told officials of the NUPRC during the hearing.
He also directed that steps be taken to recover outstanding obligations owed to the host communities.
“We are going to write them and we are going to give them an ultimatum to pay up what is owed the host communities,” he said.
The committee faulted SEEPCO for failing to appear before it despite previous invitations, warning that all stakeholders in the petroleum sector must comply with their statutory responsibilities.
Earlier, NUPRC officials led by its Director of Host Communities, Ufondu Ejiro, defended the establishment of the trust.
Ejiro said the trust had been properly incorporated, funded and structured in line with the provisions of the Petroleum Industry Act.
She said the regulator had processed relevant documents covering community consultations, governance arrangements, funding and Community Development Plans.
However, counsel to the affected host communities, Peter Chukwudi, challenged the NUPRC’s position.
Chukwudi argued that some individuals recognised as representatives of the communities were not accepted by the people, while also alleging that adequate consultations did not take place before the trust was established.
He questioned the level of development in the communities despite years of oil exploration and production and urged the committee to investigate their complaints.
The RMAFC Chairman, Mohammed Shehu, said the commission would continue to protect the interests of oil-producing communities and strengthen oversight of institutions responsible for ensuring that communities receive the benefits provided by law.
Shehu described the investigation as “an important national service and a critical national responsibility.”
He called for firm oversight, transparency and accountability in the management of national revenue assets.
The Anambra State Commissioner for Petroleum and Mineral Resources, Professor Charles Ofoegbu, also called for stronger cooperation between the NUPRC and state governments in verifying community representation and monitoring compliance with statutory requirements.
Other commissioners expressed concerns about the verification process and the relationship between regulators, operators and state governments.
The Federal Commissioner representing Rivers State, Desmond Akawor, said there appeared to be a gap between the NUPRC and affected state governments, while the Kogi representative, Abdulazeez Idris-King, questioned whether documents supplied by operators were sufficient to prove that genuine consultations had been held.
The Jigawa representative, Hauwa Umar-Aliyu, urged regulators to remain professional and impartial in resolving disputes involving host communities and petroleum operators.
The Host Community Development Trust was established under the Petroleum Industry Act 2021 to provide direct and sustainable benefits to communities hosting oil and gas operations.
Under the law, petroleum operators are required to contribute three per cent of their actual annual operating expenditure from the preceding year to the trust for the development of their host communities.
The NUPRC is responsible for regulating the trusts, including their incorporation, funding, governance and implementation of community development projects.
