PIA: Host communities demand upward review of 3% statutory fee

The Host Communities of Nigeria Producing Oil and Gas (HOSTCOM) have demanded an upward review of the three percent statutory fee accruing to host communities.

The three percent fee is Operating Expenses or Expenditure (OPEX) of the previous year being remitted to host communities by oil companies as stipulated in the Petroleum Industry Act (PIA) 2021.

According to HOSTCOM, the review has become necessary given the present economic realities.

Benjamin Tamaramiebi, president of HOSTCOM, made the call on Tuesday in Abuja while briefing newsmen. He said the existing three percent had become insufficient due to the prevalent economic realities.

Tamaramiebi also appealed to the oil companies that had not complied with the HOSTCOM regulations to do so immediately to incorporate the Host Communities Development Trust Fund (HCDT) for maximal use.

“While we commend the implementation of the PIA 2021 that has started in some areas, there are many things and many communities that have to be taken care of.

“The above applies to the three per cent accruing to host communities. There is a need for the immediate upward review of the three per cent which is now very insignificant due to the prevalent economic realities.

“We give kudos to the Nigeria Upstream Petroleum Regulation Commission (NUPRC) for prioritising first the HOSTCOM Regulations and today we are seeing the improvement in our production,’’ he said.

He said the three per cent provision which was given in 2021 was no longer a reality or dependable.

According to him, they will engage the leadership of both chambers of the National Assembly and members to push for amendments to the PIA to address contentious areas and clauses.

Listing sections for amendment, he included section 257 sub-section two that provided “if there is vandalism or sabotage, the community will forfeit the actual cost of repair.

“While section 52 says there should be a Midstream and Downstream Gas Infrastructure Fund.

“In section 52, sub-section seven (d) and section 104 sub-section four says, money received from Gas Flares Penalties by the Commission shall be for environmental remediation and relief of the host communities of the Settlors on which the penalty are levied.

“Gas Flare funds shall be channelled to the Trust Fund Account set up by Settlors to avoid crises, and other notable sections of the PIA 2021 Act,’’ he said.