Host communities should benefit directly from 13% derivation – Kachikwu

June 11th, 2018

By Obas Esiedesa

The Minister of State Petroleum Resources, Dr Ibe Kachikwu has said that oil and gas producing communities should benefit directly from the statutory 13 percent derivation paid to oil producing states.

Kachikwu spoke through his Special Adviser, Dr Tim Okon, at the opening of a 2-day Civil Society Conference/High level meeting on Open Government Partnership (OGP) commitments on the Extractive Sector.

The workshop which attracted participants from government agencies and Civil Societies (CSOs) across the country was sponsored by Trust Africa in collaboration with the Nigeria Extractive Industries Transparency Initiative (NEITI) and the OGP.

The Minister stated that not much attention is being paid to how monies allocated to states and local governments are been spent.

He urged CSOs and other non-state actors to demand for direct benefits for oil and gas bearing communities, noting that the idea of the 13 percent was to ensure that host communities are taken care of.

He pointed out that there is a significant gap on how transparently monies at the states and local governments are accounted for, advocating for the establishment of key institutions at the sub-national level to monitor governments spending.

He said: “Host communities exist in states and if states are deriving income from the extractive industry, then host communities should be direct beneficiaries of such income.

“So we need to do some work about transparency at that level to make sure that income that comes into the state are transmitted to the development in the communities”.

He explained that there is the need to build institutions that would sustain the ongoing reform of the extractive sector in the country, noting that currently institutions that should ensure that are weak.

He said while efforts are being made to recover stolen assets from corrupt officials, the critical issue of managing the recovered assets must be looked into.

According to him, “the state suffers twice when first, its resources are stolen and then having those resources rot away after they have been recovered”.

Earlier, the Executive Secretary of NEITI, Mr. Waziri Adio said while there were a lot of similarities between the EITI and the OGP, both were complimentary and geared toward ensuring transparency and accountability in government business.

He disclosed that about 51 were implementing the EITI process with 76 countries operating the OGP. Nigeria, he said, is among the few implementing the two initiatives.

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