The Host Communities of Nigeria Producing Oil and Gas (HOSCON) said it is targeting $5 billion in partnership with the private sector to jumpstart investment drive and development in the oil producing states in the country.
Indication to this effect was given at the weekend by the Executive National Chairman of the body, Dr. Mike Emuh, in Warri, Delta State, during its national executive committee meeting where major decisions were also taken towards achieving the investment objective.
According to Emuh, while statutory financial allocations could come from the government for the development of the oil and gas producing states, it is time strategic steps are taken to involve the private sector not only in managing such funds more efficiently but also utilising resources from the private sector to augment partnership that works for the good of all parties.
Emuh, who eulogised President Muhammadu Buhari for his administration’s gesture towards the oil and gas producing states by signing the Petroleum Industry Bill into law, now Petroleum Industry Act (PIA) and thus making a three percent allocation to them, also noted the payment of the 13 percent Derivation Fund, which he said was done in appreciation of the challenges faced by the locals in the oil and gas communities.He, however, said while awaiting the implementation of the PIA and the fact that the 13 percent derivation funds were being paid directly to the state governments instead of the local communities as expected going by the dictates of the constitution, there is the need to look inwards and take some decisive steps to better the lot of the people.
Emuh said it was in this regard that the meeting was called to interface with assigned consultants on the investment drive to be briefed and decisions taken on the way forward.
“Since our financial investors said they are ready to the extent we are also ready, we have applied for a five billion dollars facility and we hope to pull this through and begin investment in the basic areas of our interest in the oil and gas producing states across the country,” he said.
In his presentation, David Audu, a trained architect, who served as consultant to HOSCON, listed five major areas that were being looked into for investment, namely Compressed Natural Gas (CNG), Agro-allied industry, housing development, gas plant and modular refinery as well as blue economy.
He explained the relative benefits of each of the investments to the host communities when they come on stream and why action had to be taken now to take advantage of some prevailing economic factors. Audu, for instance, noted the importance of investing in the CNG in the face of the imminent removal of oil subsidy which, he said, would push up the price of petrol while that of CNG would still be far cheaper in relative terms.He also noted that the resources for production in all the listed investments were so abundant in the local communities and thus provides sound investment opportunities.“ According to the NNPC, as at January 2022, while there were about 87 billion barrels of crude oil deposits, gas resources at the same period was put at 208 trillion cubic feet making CNG as a very viable enterprise even in the face of imminent oil subsidy removal”, Audu stressed.
Meanwhile a financial expert, Alfred Ajagbe, who also served as consultant to HOSCON executives, assured them of availability of funds to finance the investments, subject to bank guarantee.“ Our investors are making an offer of funding that does not require cash backing.
What this means is that any bank that can issue bank guarantee and you can get billions of dollars. It’s so simple”, Ajagbe stated.