FG unveils model for Host Community Development Fund – The Whistler Newspaper

0

The federal government, in an effort to implement Section 235 of the Petroleum Industry Act, unveiled the Host Community Development Trust model on Tuesday.

The unveiling, which took place during the issuance of the Petroleum Exploration License for the 2020 Marginal Land Tender Round held in Abuja, will attract PIA dividends to the host communities.

The PIA, signed into law last year by President Muhammadu Buhari, has opened up many opportunities for gas investors.

Section 235 of the PIA provides for the establishment of a Host Community Development Trust by the Settlors (the oil and gas companies) for the benefit of the host communities.

The law assigned responsibility for setting up the HCDT and appointing the Board of Directors (BoT) to companies in consultation with host communities.

Similarly, Article 247 of the law obliges the BoT to set up a management committee to manage the general administration of the fund.

The HCDT provided by the PIA proposes to advance and propagate educational development for the benefit of members of the host communities within the funds available to the BoTs for such purposes.

Speaking at the event, the Chief Executive of the Nigeria Upstream Petroleum Regulatory Commission, Gbenga Komolafe, said the unveiling of the model was imperative as the Commission is committed to transparency in its processes.

He said: “It is equally important that the Commission today unveils the model and procedural guide for the Host Community Development Fund for the start of the implementation of the provisions of Section 235 of the PIA. , 2021 to attract the dividends of the Host Communities Act.

“The Commission is committed to ensuring the transparency of its processes. Therefore, we have implemented the Beneficial Ownership Report, which requires full disclosure of ownership information.

“The objective is to ensure financial transparency, accountability and management of public finances, among others. Interestingly, the Nigerian Oil and Gas Assets Beneficial Ownership Registry Portal was developed by NUPRC ICT and will continue to be used to ensure the compliance required by oil and gas companies.

Regarding the issuance of the oil exploration license to the winners of the 2020 marginal fields auction round, he recalled that one of the main tasks inherited by the Commission, when it was inaugurated last year, was the need to wrap up the 2020 marginal field auction round. exercise.

The NUPRC boss said that since the start of the Marginal Field Bid Round exercise in 1999, a total of 30 fields have been awarded, of which 17 are currently in production.

A breakdown of field allocation to local operators showed that two fields were allocated in 1999, 24 in 2003/2004, one in 2006 and 2007, and two in 2010.

Ten years later, in 2020, 57 plots were auctioned.

He added that the Fiscal 2020 Marginal Field Bid Round for which PPLs are issued has attracted government revenue of around N200 billion and $7 million respectively.

Komolafe also said the passage of the Petroleum Industry Act ended the era of fringe field rewards.

Section 94(9) of the Act states that “No new marginal field shall be declared under this Act”. Accordingly, the Minister must now award PPLs on undeveloped fields following an open, fair, transparent, competitive and non-discriminatory bidding process in accordance with Sections 73 and 74 of the Act.

While congratulating the new licensees, the NUPRC boss urged them to embark on developing their awarded assets in line with industry best practices.

He said, “We will continue to provide a predictable and conducive regulatory environment for operators in accordance with our technical and commercial statutory mandates to optimize the development and exploitation of the country’s hydrocarbon resources.

“It should be noted that the average price of crude oil over the past few months has been above $100 per barrel. This upward movement in market fundamentals is largely related to the Russian-Ukrainian conflict.

“However, the impact of rising crude oil prices is not reflected in the country’s revenue due to disruptions to our domestic oil production due to sabotage, theft and other operational issues.”

He urged potential licensees to take advantage of current market realities and bring their fields into production quickly.

ENDS


Source link

Share.

Comments are closed.