Oil and gas host communities in Akwa Ibom State have expressed frustration over the delayed release of funds by oil companies to Host Communities Development Trusts (HCDTs), which is hindering the implementation of projects outlined in their respective development plans.
Community leaders and representatives from HCDTs in Ibeno, Eket, Mbo, Esit Eket, Uruan, and Ikot Abasi Local Government Areas lamented the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) failure to enforce statutory sanctions on oil companies that either delay funds or refuse to establish their required Trusts.
These concerns were highlighted in a communiqué issued at the conclusion of a two-day stakeholder dialogue organized by the Civil Society Legislative Advocacy Centre (CISLAC), with support from Oxfam in Nigeria. The event, themed “A Pathway to Sustainable Development and Unlocking HCDT Benefits in the Petroleum Industry Act,” brought together various stakeholders, including representatives from Oxfam in Nigeria, CISLAC, the Akwa Ibom State Ministry of Environment and Mineral Resources, Policy Alert, and the Ibeno Youth Advocacy Network (IYAN), among others.
The communiqué noted that, “The Nigeria Extractive Industries Transparency Initiative (NEITI) Oil and Gas Audit Report 2022/2023 provided data on the HCDTs. However, the data are not disaggregated to address the specific HCDTs established by the Settlors.”
It further raised concerns that, “Benefits from the HCDTs are often hijacked by elites and leaders such as political figures, former oil company employees, and traditional leaders, thereby denying the wider community the intended benefits from oil revenues.”
The report also pointed out issues of corruption and opacity in the management of HCDT funds, which deprives communities of critical social goods and services, including healthcare, education, and agricultural inputs. It added that many Host Community Development Plans are not participatory or inclusive, failing to reflect the true needs of the people.
In response to these challenges, the communiqué made several key recommendations:
NUPRC Accountability: NUPRC should provide data on the 3% OPEX revenue paid by the settlors and ensure transparency in how this revenue is calculated.
NEITI Data Disaggregation: NEITI should disaggregate its data per asset for HCDTs, as it did for Corporate Social Responsibility (CSR) in its simplified 2024 Oil and Gas Industry Audit Report.
Addressing Total Energy’s Non-Compliance: The Akwa Ibom Ministry of Environment and Mineral Resources should assist Ibeno, Mbo, and Esit Eket HCDTs in addressing Total Energy’s failure to set up an HCDT in Akwa Ibom State. NUPRC should intervene, as Total Energy is not legally allowed to select which HCDT to establish. Communities were also encouraged to seek legal redress when shortchanged by their HCDTs, as provided under the Companies and Allied Matters Act (CAMA) 2020.
Digital Transparency Platforms: All HCDTs should establish digital platforms, such as websites, to promote transparency and provide easy access to information regarding their operations.
Disclosure and Accountability: Boards of Trustees (BoTs) and management committees should disclose details of their activities, including funds received, projects implemented, beneficiaries, costs, and contractors.
Investigative Media Role: The media should be supported to engage in investigative reporting and tracking of HCDT projects in host communities, and there should be collaboration between NUPRC, civil society organizations (CSOs), HCDTs, and community members to address emerging issues.
The communiqué emphasized that the Host Community Development Trust (HCDT) is a vital component of the Petroleum Industry Act (PIA), designed to ensure that communities hosting petroleum operations receive fair compensation and benefits.
Peoplesmind