In the latest Presidential memo on the Petroleum Industry Bill, obtained by Saharareporters, the Goodluck Jonathan regime reveals its final plan for the so-called "10 percent" Niger Delta community payments measure announced by late Umaru Yar'Adua over a year ago.

The so-called plan was drafted by Dr. Emmanuel Egbogah, Presidential Adviser on Energy.  (For details of his contentious contributions, see pp.88f and pp.289f of the attached document).

Under the latest terms, oil companies will enjoy unrestricted profits - the pesky 10 percent share with Niger Delta residents having been excised by the drafter.
When Yar'Adua's administration first announced the 10% in September 2009, it was said communities would "own" a 10 percent equity stake in the Federal Government's 6 Joint Ventures (JVs) with Shell, Mobil, Chevron, Total, Agip, and Panocean.  But under Egbogah's revision, communities are only pledged $600m a year - regardless of company profits - in "host community dividends" as "compensation."  Of course, the National Assembly can yank these back whenever it chooses.

    * In fact, the pledged amount is way less than 10% of anything: Under current production levels and prices, 10% of joint venture revenues, whether gross or net, would amount to several billion dollars, not $600m.  $600m also is no more than 1-2% of total annual government revenues from oil.

    * The plan contains no detailed provisions for how the $600m a year will be managed locally - these are all left up to "regulations."  Given the long history of cash from oil companies causing violence in the Delta, announcing another round of company payments with no set idea of how to manage them is reckless and dangerous.

    * The plan has been developed with next to no outside input from experts or stakeholders: It seems Dr. Egbogah basically dreamed the whole thing up from his office at NNPC Towers in Abuja.  Much of the detail appears to have been worked out by a handful of college-aged young men he keeps as assistants.

 Virtually no one in the Niger Delta has seen it -- there have been no consultations with militant leaders, state government officials, traditional rulers, civil society, or the communities themselves.  Nearly everyone has been kept in the dark.  Nor has the plan been released for public hearing at the National Assembly, since it wasn't in the Petroluem Industry Bill when hearings were held earlier this year.

    * The plan forces the oil companies, not government, to compensate the communities. This, again, is not what was originally announced.

    * Worst of all, the plan just recycles some of what oil companies have already tried in the Niger Delta:  For years now, the International Oil Companies have been handing out about a half-billion dollars a year in cash to Niger Delta communities. Yet there is no evidence such payments have rehabilitated local economies or improved living standards for the poor, or that they have brought long-term peace.  In many cases cash from oil companies has caused more violence and dysfunction than it fixed.  Basically, Egbogah has substituted another quick-fix oil company corporate social responsibility measure for something that could have mattered.

The PIB is edging closer to being approved. It this watered-down, ill-conceived "10 percent" bogus amendment by Egbogah and Goodluck Jonathan is passed, it will do more harm to the interest of the Niger Delta region than any previous regime has ever done.

 See Dr. Egbogah Memo attached.


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