NUPRC Explains Workings of New Host Communities‘  Reporting Platform, Says Some Interests Fighting Back

Emmanuel Addeh in Abuja

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) yesterday explained how the new ‘HostComply platform’ would operate, insinuating that it was being blackmailed by those who want to maintain the status quo to the detriment of the country and host communities who suffer the effect of oil exploration.

In a statement yesterday, the NUPRC which was reacting to a story by a national newspaper, indicating that communities were angry over charges associated with the operation of the platform meant to improve service delivery to oil-bearing communities, described the report as  ‘spurious propaganda’.
While taking a swipe on some industry players who it said cannot and would not want to play by the rules, the NUPRC stated that they would employ every instrument to paint unbecoming pictures just to frustrate genuine attempts at sanitising the industry.

The NUPRC stated that the setting up of HostComply was in furtherance to the provision of the Petroleum Industry Act (PIA) 2021, Chapter 3, section 235(1) which says: “The settlor shall incorporate Host Communities Development Trust  for the benefit of the host communities for which the settlor is responsible”.
It added that Section 235(4) of the Act states that: “The settlor shall for the purpose of setting up the trust, in consultation with the host communities, appoint and authorise a board of trustees, which shall apply to be registered by the Corporate Affairs Commission (CAC) as a corporate body under the Companies and Allied Matters Act (CAMA).”

Besides, the NUPRC stated that Section 240(1-4) specifies sources of funding for petroleum host communities development trust while Section 244 (a – c) specifies how the funds are to be allocated.
“Specifically, Section 244(c) states that: An amount not exceeding 5 per cent to be utilised solely for administrative cost of running the trust and special projects, which shall be entrusted by the Board of Trustees (BoT) to the settlor, provided that at the end of each financial year, the settlor shall render a full account of the utilisation of the fund to the BoT and where any portion of the fund is not utilised in a given year, it shall be returned to the capital fund,” it added.

Therefore, what the NUPRC, as the regulator of upstream petroleum activities in the country, did, the commission said, was to set up a cutting-edge solution, HostComply, to streamline reporting of environmental, social, and governance (ESG) management for the operators, host communities and regulators, in line with the requirement of the PIA.

“It was designed to ease regulatory compliance and oversight function for the regulator and to enable the settlors meet regulatory requirements in a timely, efficient, cost-effective manner,” it stressed.
The Gbenga Komolafe-led organisation pointed out that HostComply which is now put on the firing line by those it described as industry saboteurs and their hirelings would not be the first in recent times to attract a negative attack on the regulator.

It recalled that when the regulator insisted on having Original Equipment Manufacturers (OEM) install and manage metering devices/activities at crude oil export terminals, the same people ‘went on overdrive’ because it was obvious it would no longer be business as usual.
“Nigeria loses huge revenues periodically as a result of metering infractions; and perpetrators and their accomplices would not let go nor accept any regulation that would put them out of business.

“It is not a hidden fact that host communities in oil-bearing and producing areas in the country have been suffering devastation and deprivations of all sorts due to the activities of some critical stakeholders who short-change and create divide-and-rule systems to flourish.

“ The Host Communities Development Trust (HCDT) was deliberately created to address the concerns of the host communities and stop the activities of the Shylocks and their collaborators. The NUPRC as the regulator is putting everything in place so that the overall intendment of the PIA on this score is effectively realised for the benefit of those envisaged.
“We are therefore not surprised that they fighting back, using every available means, including trying to confuse and deceive members of the public with concocted narratives.

“ When they are on such mischief mission, they cleverly avoid seeking clarifications from the NUPRC but rather prefer to quote, out-of-context, correspondences issued by operating units of the commission in the process of giving impetus to the implementation process,” it added.

According to the commission, the online platform is meant to offer comfort to the HCDT by providing them with a robust technological tool to interface and engage with the settlors and manage projects in their respective communities professionally while meeting global ESG best practices.

Despite the distraction, the NUPRC stated that it was committed to fostering stronger relationships between operators, host communities, and regulators, and enhancing the dividends of petroleum resources for the prosperity of all stakeholders.

“HostComply limits to the barest minimum human interference and represents a significant step forward in achieving this vision.  It is only the non-conformists and those who have something to hide that are afraid of regulations, especially if the regulations limit their capacity to short-change the system and the people,” the commission said.