The Senate has directed the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to impose sanctions on International Oil Companies (IOCs) that have failed to comply with provisions of the Petroleum Industry Act (PIA) regarding the establishment of Host Communities Development Trusts (HCDTs).
The resolution came during the commissioning of seven community projects executed by TotalEnergies in the Obagi oilfield, Ogba/Egbema/Ndoni Local Government Area of Rivers State.
Chairman of the Senate Committee on Host Communities, Benson Agadaga, said the three-month grace period given to oil firms to set up their trusts had elapsed, insisting that erring operators must now face the consequences.
“The law is clear. The time of grace is over. Any IOC that has not established its Host Community Development Trust is in breach of the PIA and must be sanctioned,” Agadaga said.
He commended the implementation of the HCDT scheme, noting that it had contributed significantly to peace in oil-producing communities and boosted Nigeria’s chances of hitting its two million barrels per day production target.
The lawmaker praised TotalEnergies and the Obagi HCDT for delivering community-identified projects across infrastructure, health, agriculture, and empowerment. He urged other host communities to emulate the initiative and speed up their own project executions.
The PIA, enacted in 2021, mandates oil firms to create HCDTs funded with a percentage of their operating expenses, aimed at ensuring host communities directly benefit from petroleum operations.
Agadaga warned that full enforcement of the law was essential to safeguard stability in the Niger Delta and prevent disruptions to oil production.
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