The Nigeria Extractive Industries Transparency Initiative (NEITI) has called on oil companies operating in Nigeria to prioritise the development of their host communities by ensuring the effective utilisation of the three percent Operating Expenses (OPEX) allocated for community projects.
NEITI’s Executive Secretary, Dr. Orji Ogbonnaya Orji, made this call on Thursday in Abuja at the official presentation of a policy brief titled “Giving Host Communities Their Due: Revisiting the Three Per Cent OPEX Funding Framework for Host Community Development Trusts in Nigeria.”
The event was organised by Spaces for Change, a Civil Society Organisation (CSO), and was attended by key industry stakeholders, government officials, and representatives of host communities.
Orji said oil companies must demonstrate greater corporate commitment to the welfare of host communities, which bear the direct impact of resource extraction.
He reiterated that the Host Communities Trust Fund, established under the Petroleum Industry Act (PIA) 2021, was designed to ensure sustainable development and promote peaceful coexistence between industry operators and local communities.
“This fund, established under the Petroleum Industry Act (PIA 2021), is designed to enhance the welfare of host communities, ensure sustainable development, and promote peaceful coexistence between industry operators and their host environments,” he said.
Orji stressed NEITI’s role in promoting transparency and accountability in Nigeria’s extractive sector, adding that the organisation is mandated to track revenue flows and financial transactions related to host community funding.
He added that the agency is committed to “the implementation of the Host Communities Trust Fund, NEITI’s role is multifaceted.”
Take ownership of development projects – Orji tells host communities
He also urged host communities to take ownership of projects implemented through the funds for their benefit.
“The host communities must be willing to take responsibility by owning and maintaining the projects implemented for their benefit,” he emphasised.
House committee pledges improved oversight
Similarly, the Chairman of the House Committee on Host Communities, Dr. Dekor Robinson, pledged improved legislative oversight in the implementation of the funds in the various oil-producing communities and ensure that they are well utilised.
Robinson, who was represented by a member of the committee, Clement Jimbo, dismissed claims that the three percent allocation was too small, insisting that proper management of the funds could drive meaningful development.
What you should know
- The three per Operating Expenses (OPEX) is a provision under Nigeria’s Petroleum Industry Act (PIA) 2021, which mandates oil companies to contribute three per cent of their annual operating expenses to a Host Communities Development Trust Fund.
- The fund is meant to support sustainable development projects in communities affected by oil and gas operations, improve their welfare, and promote peaceful coexistence between oil companies and their host communities.
- Recently, Senator Ned Nwoko, representing the Delta North Senatorial District, alleged that his constituents are not benefitting from the 3% remittance of oil companies located in his district.
