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PIB: Okowa, community leaders disagree on funds accruing to host communities

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Paul Osuyi, Asaba

GOVERNOR Ifeanyi Okowa of Delta State and some community leaders in the state on Thursday disagreed on the percentage of funds for oil bearing communities in the proposed Petroleum Industry Bill (PIB) which addresses the relationship between International Oil Companies and oil producing/impact communities.

While the community leaders proposed 10% of the quantum of production to be set for host communities, the governor advocated for an annual contribution of amount equal to 5% of gross revenue from oil and gas production.

The stakeholders spoke in Asaba during an interactive session between the Senate Joint Committee on PIB and oil producing/impact communities in Delta State.

Leaders of various ethnic nationalities including Ndokwa, Itsekiri, Isoko, Ijaw and Urhobo who made their submissions before the governor, were unanimous in advocating for the 10% of quantum of production which should be reviewed after a specified period.

But Okowa in his submission disagreed with the community leaders, saying that it would be difficult to determine the operational cost of oil companies.

He argued that the 5% of the gross revenue would give more money to host communities, noting that oil companies may never reveal their real operational cost.

Okowa also proposed the setting aside of 15% of funds payable to host communities as endowment as against the 20% proposed in Host Community Bill.

He said that the proposed bill had failed to make provision for administrative costs in the management of such endowment funds, adding that instead, 15% of whatever amount that would be accruable to the communities should left for the future.

He noted that the balance of 5 per cent should be deployed for administration of a proposed trust fund.

Okowa who quoted relevant sections of the proposed bill, said that the draft bill will govern activities of the host communities and the International Oil Companies (IOCs), and must be supervised by the Federal Government.

According to the governor, the host community must take charge of projects to be executed in the area and will consult with the IOCs in the appointment of members of the proposed trust committee.

The governor said though the host communities have responsibility to protect the oil facilities, it was incumbent for the oil companies to include the communities in their facility surveillance team to avoid conflict of interest.

Chairman of the Senate Joint Committee, Omotayo Alasaodura had told participants that the interactive session was aimed at getting inputs from all stakeholders in the proposed bill with a view to addressing the age long challenges of under development of oil bearing communities.

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