Senator Peter Nwaoboshi represents Delta North District at the Senate. The Chairman of the Senate Committee on Niger Delta Affairs spoke with reporters on plans to amend the Niger Delta Develoment Commission (NDDC) Act 2000 and other issues. EMMANUEL OLADESU was there.
What actually made you to initiate the NDDC Amendment Bill?
The Niger Delta Development Bill was promulgated in 2000 and it was one of the first bills that the former President Olusegun Obasanjo refused to assent to and the National Assembly had to override him and it became an Act of the National Assembly and, therefore, it became a law. When I became the Chairman of the Niger Delta Affairs in the Senate, I went through the bill and l decided something must be done. l decided to become an indomitable champion of the cause of the Niger Delta and its long marginalised people, for whose sake l have successfully championed the effective amendment to the NDDC Act of 2000.
Is the NDDC is under-funded?
First, there was the problem of NDDC being under-funded; there was no sufficient fund to run it. The Federal Government owes the NDDC almost N1trn as I speak with you now and the NDDC runs a deficit, in terms of their exposures, of over N1. 2trn. That is their debt profile and the Federal Government is not paying. When you go through the law, you will see that they were supposed to pay 50 per cent of the Ecological Fund due to member- states; 50 per cent of that Ecological Fund that is due to member- states is supposed to be paid to the NDDC but as I speak with you now, not one kobo has been paid from the Ecological Fund to the NDDC. Another source of revenue is from the oil and gas processing companies. Now, if you go to the oil companies, the law says that they should pay three per cent of their total annual budgets to NDDC. We now asked ourselves, if the NDDC was going to get 50 per cent of the Ecological Fund, which is due states in its mandate area, get three per cent of the total annual budget of the oil and gas processing companies and also the Federal Government is to pay a particular percentage to them, then there is no reason why it should be under-funded. So, the question was what is really happening? Why is it that they are not being paid and why all these problems?
When we looked at all these, we said let us do a public hearing to find out truly why the NDDC is in this debt problem. We went further to discover that the Liquefied Natural Gas(LNG) or even the other gas companies, none of them had paid one kobo for the past 17 years and we asked why, after all, the law is clear. In the process, we discovered that LNG said that they went to court with NDDC and late Justice Nwodo of the Federal High Court gave judgment in their favour; they also went to the Court of Appeal and then, they proceeded to the Supreme Court. Due to the fault of the legal team, they didn’t meet up the period to file their documents and the Supreme Court struck out the appeal on technical grounds, meaning, in effect, that the NDDC lost. So, when we invited the LNG, they just came with the Supreme Court judgment and said ‘we have a judgment at the Federal High Court, we have a judgment at the Court of Appeal and since we have all these judgments in our favour, we are not going to pay’. As a lawyer, I asked for a copy of the judgment, I went through the full judgments and I said ‘Ok, we have a way out of it.’ In fact, my brothers in the lower chamber, the House of Representatives, started the process of amending the LNG Act and, in the process, the LNG started going round the whole country, using all their connections and all of them were putting pressure. They went everywhere, to the then Acting President, Yemi Osibanjo, elsewhere, even foreign countries got involved, almost everybody got involved and they were now putting pressure on the National Assembly as if they (National Assembly) were just out to spoil the source of revenue for Nigeria, but the House of Representatives went ahead to amend the LNG Act, removed their waivers and some of the incentives given to them . But I felt that was a very long journey and it was going to attract many issues and I said ‘let us just amend that particular section.’ Having looked at the judgments of the Court of Appeal, the Supreme Court and the Federal High Court, I knew where the problem was and said what we want is to amend this section and, in the process, that was how we decided to bring more revenue for the NDDC. That’s it.
When did the journey to amend the Act actually begin?
In fact, there are two amendments to the NDDC Act that have been passed by the Senate. One is more comprehensive. In that one for example, if you look at the representation in the Niger Delta Development Commission, it says one member from the oil-producing area of the state. That has caused a lot of problems as to how you define an oil- producing area. Do you define it vis-a-vis the local government area or do you define it vis-a-vis the senatorial district, or vis-à-vis the state? It is an issue and so, many problems came up when we were going to clear some nominees of the President and people said we should use states, some said we should use senatorial districts and some others said it should be local government areas. But, I and most of my colleagues said that it should be local government area that produces the oil and that’s how we disqualified the people from Abia, the Ondo nominee and of course that of Imo withdrew. Therefore, to remove that ambiguity in the law, we had to go through the amendment and many other sections we needed to amend. But this issue of revenue became very important because you cannot set up a commission like that and they are always crying for funds. The journey started when we discovered all these flaws; we said let’s deal with these issues.
To what would you attribute the success of the Bill?
First, the issue is that everybody in the National Assembly, from the patriotic side, whether you are from the North or anywhere else, believed that there is the need to adequately fund the NDDC. Secondly, the people from that geopolitical zone, the South-south geopolitical zone, see it as a duty to make sure that that place is well funded. So, for everybody from the South-south, whether Senator or in the House of Representatives, it is a call to duty because that is the commission that was established to serve the whole people of the South-south and our brothers from Ondo. So it was a popular bill, it became very popular in the National Assembly. And of course, they saw and did not like the fact that the gas- producing companies for 17 years in the area were not contributing to the development of that area directly to the NDDC; so, it was a very popular bill, and, like I told you, they were looking for any way to make sure that these people contribute. It is the popularity of the bill and also the feeling by some people that the undeserved under-funding of NDDC is not right and the nationalistic feeling of Nigerians; those are the reasons why it was popular.
What, in your view, are the long and short term effects of the Act, in terms of the development of the Niger Delta area?
Revenue; it’s going to give them more revenue and let me say that I must thank Mr President because the Act was signed on the last working day of the year and it means that the Act took effect from last year, 2017; the moment it was assented to it become a law. So, the LNG has to pay for 2017; they just have to pay. In the process of negotiation with the oil companies when the bill came, the gas companies also became interested and they saw that there was no way that they would not be asked to pay something. They threatened that they were going to go to court and we said ‘okay, you can go to court.’ But we now had to discuss with them on the issue of feed gas; when you look at the bill, you see feed gas. ‘Minus the cost of feed gas’ that was a compromise we struck with the gas companies. Let me explain what they mean when they are talking about and when they say ‘after deducting the feed gas’; one of the things they were canvassing for is to avoid what they see as double taxation. Shell, for example, is a major shareholder of LNG. Now, Shell is saying that ‘if am paying three per cent of my annual budget to NDDC and you are also asking me to pay three per cent from the gas I produce because it’s from that budget I produce all these things, when I have given you three per cent of my annual budget, that would be unfair’. So, Shell said that would be double taxation. Then all the other shareholders in the LNG, who are major oil companies, said they will not accept it (double taxation). Essentially, they said, ‘if you are going to ask us to pay three per cent after we have paid another three per cent of our annual budget as oil processing companies …if after that then you ask us to pay three per cent for gas processing, it will be double taxation and if you are going to do that, we will go to court.’ Of course, while we appreciate the fact that if they were to go to court, we can be neither here nor there, depending on how the judges will see it, we said let that area of processing be removed, which is called the feed gas, but after that they should pay the rest.
How can the NDDC recover the money that is hanging?
First, we invited the Accountant -General of the Federation, because for example, I have told you that they are not paying the 50 per cent of the Ecological Fund due to member- states. We have got the Accountant- General, he has said his own side, we have got the Permanent Secretary in (charge of)the Ecological Fund and we invited the Auditor- General of the Federation; in fact, we have invited almost everybody that is involved but we know that if we calculate that, even at that, we would be able to get something for 17 years.
