The Nigeria Senate has on Thursday adopted a three per cent allocation to host communities in the Petroleum Industry Bill, regardless of the rancour displayed by southern lawmakers at the National Assembly over the allocation.
The southern lawmakers at the national assembly had demanded five per cent for host communities.
The Southern Senators are protesting the percentage of the total operating expenses (OPEX) oil companies are expected to contribute to a trust fund created for host communities.
Senators George Sekibo and Seriake Dickson, Southern Senators on Thursday, raised alarms over the endorsement of the allocation by the senate.
While Senator Sekibo said he is not part of the vote on the allocation clause, Senator Dickson on his part said his privilege had been breached as his views were not considered.
However, while reacting to the protests by the southern senators over the matter, Senate President Ahmad Lawan replied that the Nigerian Senate had taken a final resolution on the matter and could not go back on its decision.
After the National Assembly passed the petroleum Industry Bill (PIB) earlier this month, the host community allocation was one of the bones of contentions left in consideration.
The Petroleum Industry Bill (PIB) is expected to transform Nigeria’s oil industry. The three per cent allocation varies from the 13 per cent derivation fund which is paid to oil-producing communities from the federation account.
Instead, the three per cent allocation will come from an entity’s actual yearly operating expenditure of the preceding financial year in the upstream, midstream and downstream sectors.
All contributions will be deposited in a trust fund for host communities.
According to a draft of the petroleum Industry Bill (PIB), the trust fund will bring about peace and cordial relationship between oil-producing companies and host communities.