Background:
Despite
being among the world’s top oil producers, Nigeria’s oil and gas industry has
been plagued by institutionalized corruption, corporate impunity, and grave
environmental and humanitarian devastations. As the central point of oil production, the Niger Delta
region is most gravely affected by oil prospecting and exploration activities
in which the traditional means of subsistence, farming and fishing in the creeks,
streams and mangroves are adversely affected by constant oil spills, gas
flares, blow-outs and leaks, with spiraling effects on health, soil
productivity, aquatic life and the environment. Further aggravating the
situation is the Nigerian government’s persistent failure to provide adequate
regulatory oversight for the environment, compounded by the continuing exclusion
of affected communities in
the design and implementation of development solutions that affect them.
If passed into law, Nigeria’s
oil sector reform bill, the Petroleum Industry Bill (PIB) holds strong
prospects for improving the governance of the environment and strengthening the
structure for community participation in the oil and gas industry. Between
April 23 and 24, 2013, federal and state policymakers, environmentalists, the
media, labour unions, representatives of multinational oil companies, civil
society organizations and oil producing communities converged in Port Harcourt to begin the
process of building a sustainable consensus for realizing greater community
participation and environmental protection in the PIB.
For over two days, presentations and discussions among the
deliberating agents, with full participation of local
leaders and traditional rulers of oil producing communities proffered a range
of recommendations for enhancing community
participation in the oil and gas industry and for the protection of the
environment. With renewed commitment, participants resolved to take
urgent action to support the promotion of economically, socially and environmentally
sustainable future for present and future generations, while enhancing youth
and women’s empowerment, and equal opportunities for all Nigerians, especially in
the petroleum producing communities.
Participants further resolved and
recommended as follows to different stakeholders:
To
the Nigerian Government:
1.
Sustainable
development in petroleum producing communities can only be achieved by:
fostering equitable social development and inclusion; creating equal opportunities
for all, raising basic standards of living; and promoting integrated and inclusive
management of natural resources using rights-respecting strategies that support
environmental conservation, regeneration and restoration.
2.
The independence of the two regulatory agencies:
Upstream Petroleum Inspectorate (UPI) and Downstream Petroleum Regulatory
Agency (DPRA) must be guaranteed, and mechanisms put in place to enable them
better inform policy decisions.
3.
Oil theft, illegal refining, and gas flaring and
the resulting environmental damage they cause portend great danger to oil-bearing
communities, requiring urgent and ambitious action to
bring them to an end, in accordance with the principles and provisions of the
Nigerian Constitution, regional and international human rights treaties Nigeria
voluntarily signed onto.
4.
Multi-stakeholder
collaboration between all tiers of government, including oil companies and
their host communities is required in order to proactively address the continuing high levels of
unemployment and underemployment, particularly among young people in petroleum
producing communities. Tackling youth unemployment and poverty, as a matter of
urgency, can make an important contribution toward achieving social protection
systems that address and reduce inequality and social exclusion.
5.
When there is any divestment, the first choice
of take-over should be vested on indigenous oil companies, including qualified members
of the community where the divestment company and facilities are located.
6.
The
Wikileaks revelations alleging that security chiefs, political party
heavy-weights in connivance with state officials are benefactors of crude oil
theft in the Niger Delta should be investigated.
7.
Efforts to
achieve lasting peace, environmental security and sustainable community
development in the region should be reflected in national, state and local
policies and plans.
To the National Assembly:
1.
We call
for the adoption of all the detailed recommendations outlined in the PIB
RESOURCE HANDBOOK publicly presented at the April 23 & 24, 2013 conference.
Twenty copies of the said Handbook have been submitted to the PIB adhoc
committee at the South-South Zonal public hearing held in Port Harcourt on
April 22-23, 2013.
2.
The 2-day Zonal public hearings on the PIB
conducted across the country, especially in the South-south region was grossly
inadequate, as it afforded scant opportunities to both stakeholders and several
oil producing communities’ to participate and voice their concerns regarding
the Bill.
3.
The
passage processes must underscore access to information, broad public participation and the
meaningful involvement and active participation of national, state and
local-level legislatures and all major groups: women, children and youth,
indigenous peoples, non-governmental organizations, local authorities, workers
and trade unions, business and industry, the scientific and technological
community, and farmers, as well as other stakeholders, including local
communities, volunteer groups and donor agencies and persons with disabilities.
4.
Oil producing
communities welcome the establishment of a Petroleum Host Community Fund, and
urge the government to establish a community-based participatory structure,
known as the Community Development Board (CDB) for the effective administration
of the Fund. In this regard, the CDB will serve as an independent body, without
prescriptive interference from government agencies, state governors and
traditional institutions, whose members are appointed for a fixed tenure by
different interest groups – women, youth, traditional rulers, elders’ council -
within oil producing communities.
5.
The term host community should
be clearly defined for the purpose of determining the direct beneficiaries of
the PHC Fund. Any proposed definition must include both oil-bearing and
oil-impacted communities.
6.
Contributions into the PHC Fund should be based
on a minimum of 10% of crude oil sales rather than 10% of oil and gas
companies’ net profits because of the difficulty in determining the actual net
profit of different operators.
7.
The politicization of the PHC Fund is
condemnable. All stakeholders are enjoined to contribute towards imparting new momentum to the implementation of all initiatives
designed to address the surging local discontent in the oil-rich Niger Delta
region.
8.
Section 118 (5) of the Bill should be expunged
as communities lack the capacity to contain the high-level bunkering
operations. Deducting the repair costs of damaged installations from the PHC
Fund foists collective punishment on communities for the vandalization of oil
installations, and ostensibly outsources government’s primary responsibility of
securing lives and property to host communities.
9.
Requiring oil companies and licensed operators
to hold due consultations with oil producing communities in order to seek and
obtain their consent before the commencement of oil production is consistent
with the venerated principle of free, prior
and informed consent. This requirement should be recognized and included as
part of the obligations of licensee, lessee and contractors set out in S. 292
of the PIB.
10. The vagueness
of certain provisions in the Bill, such as the obligation on oil companies to
adopt and utilize “best practices” and “good oilfield practices” is vague, and
must be clarified. Considering that the different operators and companies often
employ standards set by their respective home countries, it is difficult to
ascertain which of these standards rate as the best.
11. To check
multiplicity of duties, the management of the remediation fund created by section
203 of the PIB should be vested in the National Oil Spill Detection and
Remediation Agency (NOSDRA), responsible for cleaning up of oil spills and
environmental remediation. This will not only guarantee the UPI’s and NOSDRA’s
independence and effectiveness, but also, inject more clarity in institutional
obligations and regulatory functionality in the oil industry.
12.
The
process for determining compensation sums for trees and venerated objects
destroyed during petroleum operations, including disturbances on the surface of
the land outlined in S. 198, 199 and 296 of the Bill should be clearly
outlined, recognizing landowners, female-headed households and communal
landholdings.
To the Oil Companies:
1.
We call
for the adoption of all the detailed recommendations outlined in the Spaces for
Change’s PIB RESOURCE HANDBOOK publicly presented at the conference, PIB &
Host Communities between April 23 & 24, 2013. Beyond analyzing and critically reviewing specific provisions
of the PIB that could potentially undermine community participation and
environment protection, the Handbook evaluates their coherence with
global best practices and standards on environmental sustainability and
participatory development. Strengthening these critical provisions is of utmost importance to
secure maximum support for the proposed oil sector reforms and avoid unwanted
consequences that stifle economic growth, social cohesion and public
participation.
2.
Oil
companies lag behind in implementing previous legislative commitments and
social policies for the protection of the environment and community rights. The
PIB ushers a new vista to adopt socially responsible business practices and
greater compliance with all regulations, state and federal legislations
regarding the protection of the environment and development of local content.
3.
All oil
companies and licensed operators are obligated to support and respect national
regulatory and policy frameworks, particularly in the areas of environmental
safety, finance and technology transfer, innovation and entrepreneurship,
capacity building, transparency and accountability.
4.
Community development programmes designed to enhance
productive capacity of local youth and indigenous oil companies is key to
realizing the development of local content, and for bolstering community
participation in oil and gas operations and decision-making.
5.
The development of clear guidelines for job
creation, complemented by effective social policies is required to abrogate the
current practice of fielding foreign expatriates in non-technical services an
departments whereby local skills and capacities abound e.g carpentry,
electrical and mechanical works, thereby limiting opportunities for youth
employment, with adverse impacts on the local economy. 70% of this cadre of
employees of oil companies should come from localities where the companies are
located.
6.
All oil
companies must take concrete steps to establish participatory structures for both
engaging their host communities in culturally appropriate ways; and for
facilitating full and effective community participation in oil and gas
operations.
7.
Oil companies should undertake and publish
periodic audit of its personnel to determine the extent it is promoting full and productive employment and decent work for members
of host communities, with a view to achieving poverty reduction and social
cohesions in communities where they operate.
8.
We call for the adoption of holistic
and integrated approaches to sustainable development in a manner that
facilitates harmonious existence with nature and lead to efforts to restore and
remediate environmentally damaged areas.
To the petroleum producing communities:
1.
Petroleum producing communities, in close
collaboration with the Nigerian government through the office of the petroleum
minister should make concrete efforts to develop a participatory community-led
structure for the effective administration of the PHC Fund.
2.
Credible and responsive community leaderships
should be put in charge of handling multinational and local community
relationships and engagements.
3.
Host communities must take ownership of
development programmes which includes sustained monitoring and evaluation on
environmental “Best Practices” applied by oil companies.
4.
The
criteria for the location of community development programs should be clearly
spelt out before the initiation of such projects. In line with the DPRA’s mandate to review the impact of
oil company development programmes and take stock of such development
programmes in Sections 293 and 297, the
reports of such reviews and stock-taking should be made public and accessible
by oil producing communities.
5.
Recognizing
that communities lack the skills to contain high-level oil bunkering
operations, community
surveillance operations must be initiated across communities hosting oil
installations, in order to complement the efforts of the national government
and its security agencies.
6.
Traditional rulers, non-governmental
organizations and community-based organizations should encourage the active participation of oil-bearing and
oil-impacted communities in processes that contribute to decision-making,
planning and implementation of policies and programmes for sustainable
development at all levels.
We acknowledge the role of civil
society in strengthening access to information as well as an enabling
environment - especially in the area of analysis, sharing of information and
knowledge, promotion of dialogue - for an active citizen engagement in public
decision-making, particularly in the passage of the PIB.
Signed….
SPACES FOR CHANGE
![SPACES FOR CHANGE [S4C]](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhKYqElpL53emtcZ76qeUprKLRrzSYITGwEHQoB5t0ecWyrq6mJa-f6LDcg5M50joQenZ405UhZbpf4UYunBWIBVV1npmtN5svWh5VamC6wd8YRs9Pg_VBsAm5w-sjf_pWJovv7bt4cO0U/s1600/S4C.jpg)