NUPRC: Higher Oil Community Cuts Facility Bombings, Gas Flaring Drops 90%
Nigerian Upstream and Downstream Regulatory Commission reports that increased federal allocations to oil-producing communities have reduced bombings of oil facilities in the country. The Host Community Development Trust now gives oil communities a larger share of national resources, decreasing attacks on infrastructure and oil spills.
Funding comes through two primary systems: the 13% Derivation Fund to state governments and 3% of oil companies' actual annual operating expenditures directly to Host Communities Development Trusts under the Petroleum Industry Act (PIA). Abia, Akwa Ibom, Anambra, Bayelsa, Delta, Edo, Imo, Ondo, and Rivers communities benefit from these allocations.
Environmental progress shows routine gas flaring has dropped drastically from over 80% to just 7% in the last 35 years. NUPRC also introduced mandatory gas utilization strategies in Field Development Plans and new directives for Measurement, Reporting and Verification practices for methane and greenhouse gas emissions.
With billions shared monthly through FAAC, communities continue to demand direct remittance of the 13% derivation fund to grassroots rather than through state governors. As Nigeria pursues environmentally friendly crude oil production, how will these funding changes impact your investments or operations in the Niger Delta?