The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has revealed that the mandatory 3% Operating Expenditure (OPEX) contribution by oil and gas companies to Host Communities Development Trusts (HCDTs) is yielding significant dividends—enhancing both peace and crude oil production across oil-producing areas.
Speaking during a meeting with the leadership of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in Abuja, NUPRC Chief Executive, Mrs. Oritsemeyiwa Eyesan, disclosed that 172 HCDTs have so far been incorporated by settlors (oil and gas firms) under the Petroleum Industry Act (PIA).
“We have laid out procedures for doing things and we have put regulations in place to streamline the process. So far, we have registered 172 HCDTs and we have been able to manage contributions by settlors,” Eyesan stated.
According to the PIA, each operator is required to set aside 3% of its previous year’s OPEX for a Host Communities Trust Fund, which is then deployed to finance social and infrastructure projects in oil-producing areas.
Eyesan noted that these funds have already been deployed to construct schools, hospitals, roads, and other critical infrastructure—directly improving the quality of life in communities that were once hotbeds of unrest.
She said the gesture has contributed significantly to peace and stability in hitherto volatile communities and has also led to an increase in production.
While acknowledging that some trusts have faced litigation over disagreements on the composition of Boards of Trustees, Eyesan assured that the NUPRC is actively intervening to resolve disputes.
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She highlighted the role of the Commission’s Alternative Dispute Resolution Centre in mediating grievances and ensuring that the trusts operate smoothly in the national interest.
Addressing a specific concern, Eyesan promised to investigate the lingering disagreement between Sterling Oil Exploration and Energy Production Company (SEEPCO) and its host community in Anambra State.
In his remarks, RMAFC Chairman, Dr. Mohammed Bello Shehu, commended the NUPRC for driving reforms that have contributed to growth in oil production. He noted that the upstream sector remains critical to the Federation Account and called for stronger collaboration between the two agencies to sustain the momentum.
Eyesan, while appreciating the RMAFC’s interest in host communities, clarified that oversight of HCDT funds remains the exclusive preserve of the NUPRC, as provided by law. She reiterated the Commission’s commitment to transparency and accountability in managing the fund, which she described as a game-changer for industry-community relations.
With over 170 trusts now operational and more in the pipeline, the NUPRC says the 3% OPEX model is proving to be a win-win—calming unrest, building infrastructure, and ultimately boosting the nation’s oil output.
Victor Ezeja is a Nigerian journalist skilled in producing insightful news analyses, feature stories, and interviews that simplify complex issues and drive informed public discourse. His work combines rigorous research, balanced reporting, and compelling storytelling to highlight developments shaping industries and society. Victor, who holds a Master's Degree in Mass Communication, specializes in energy, aviation, business, and economic reporting. He can be reached via @VICTOREZEJA on X