Oil companies, called settlors, are to establish the Petroleum Host Communities Development Trust (Community Trusts) in communities where they operate.
Settlors will determine the communities to be regarded as host communities within their area of operation.
Bill stipulates different timelines for the incorporation of the PHCD Trust according to the nature of the licenses of the settlors (oil prospecting licence (OPL), oil mining license (OML), marginal fields, etc.)
Failure to incorporate the Trust shall be a ground for the suspension of operating license.
The settlors are empowered to constitute the Board of Trustees (BOT), determine membership and the criteria for appointment into the Board
Trustees need not be indigenes of the host community, and are to serve for a term of four years, renewable for one more term.
Community Trusts will be funded by an annual 2.5% of the profit after tax of the settlor accruable from the settlor’s operations in the particular area of operations
Bill prescribes in advance, the constitutional provisions of the Trust
The Bill creates new bodies, positions and roles for the administration of the Community Trusts.
The bodies include the Endowment Fund, Reserve Fund, Fund Managers, Management Committee (with executive and non-executive members), Advisory Committee etc.
National Petroleum Regulatory Commission (the Commission) shall have the power to resolve disputes arising from the management of the Trust
Source: Spaces for Change