Reps call for sanctions for oil companies violating PIA

The House of Representatives has urged the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to revoke the licences of any International Oil Companies (IOCs) violating the Petroleum Industry Act (PIA).

The house also recommends that companies violating the protocols of the United Nations Framework Convention on Climate Change (UNFCCC) Clean Development Mechanism (CDM) and Greenhouse Gas (GHG) should be equally sanctioned.

The resolution was a sequel to a unanimous adoption of a motion by Rep. Victor Obuzor (PDP-Rivers) at the plenary on Tuesday.

Moving the motion, Mr Obuzor said that Section 240 of the Petroleum Industry Act (PIA) stipulates that oil and gas companies should remit three per cent of their annual operational expenditure to producing host communities via the host community development trust fund.

He said that the main objective is to foster sustainable prosperity within the communities, provide direct social and economic benefits, and enhance harmonious co-existence.

“Concerned that two years after the coming into effect of the PIA, oil-producing companies have deliberately refused to make the necessary remittance as mandated by the PIA, thus sparking agitation within the host communities as they are feeling shortchanged.

“The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which is mandated to facilitate speedy implementation of the 3 per cent OPEX, has awarded a penalty of $1,825 million to the defaulting oil companies, which is to be paid at the rate of N52,500 per day as stipulated by the Petroleum Industry Act,” he said.

In his ruling, the Speaker of the House, Rep. Tajudeen Abbas, mandated the committees on host communities, petroleum resources (Downstream), and petroleum resources (Midstream) to investigate and report back within six weeks.


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