PIA: FG needs to adopt bottom-up approach to avoid conflict in Niger Delta, says environmental group

The Africa Network for Environment and Economic Justice (ANEEJ) says the federal government needs to adopt a bottom-up approach in the allocation of the three percent for host communities in the new petroleum act. 

David Ugolor, executive director, ANEEJ, in a statement on Wednesday, said the approach would help to avoid conflict in the oil-producing region.

President Muhammadu Buhari signed the Petroleum Industry Bill (PIB) 2021 into law on Monday – despite criticisms from host communities o 3 percent allocation.

But Ugolor said the three percent allocation should be done without inciting conflict in the region and the government should ensure that oil majors do not take advantage of the law to undermine host oil communities’ rights.

He charged President Muhammadu Buhari-led administration to set up a mechanism acceptable to all stakeholders on how the funds would be deployed to avoid a crisis in the sector.

“As it stands today, oil-producing communities are concerned over a portion of the Act that ceded three percent to Host Communities Development Trust Fund and 30 percent of NNPC Ltd profit oil, profit gas to Frontier Oil Exploration Fund. Government should address this issue.”

Ugolor also urged the federal government to start using proceeds from oil and gas to invest in the non-oil sector for Nigeria’s future generations, saying that the country needs to begin considering renewable energy as the world steadily shifts away from fossil fuel.

He further encouraged the government to take into consideration issues raised by community/critical stakeholders in the implementation of the new law as this would help attract the much needed foreign investments into the sector. 

“We welcome the signing of the bill by President Buhari, as it will help to reposition the oil and gas industry for profitability even though the world is moving away from fossil fuel to renewable energy sources.

“The new Petroleum Industry Act will help to shape operations in both Upstream and Downstream of the Industry and will likely end ‘business as usual’ mentality plaguing the sector. It is important that the country begins now to save and invest from the proceeds of oil for the future generation of Nigerians.

“The Petroleum Industry Act will create confidence amongst investors and industry actors alike and it will help attract the direly-needed foreign direct investments (FDIs) in the sector.”