By ABDULKABIR MUHAMMED

The Foundation for Environmental Rights, Advocacy & Development (FENRAD) has called for greater transparency, accountability, and community participation in the implementation of the Host Community Development Trust Funds (HCDTFs) as provided for under the Petroleum Industry Act (PIA), 2021. The Petroleum Industry Act was enacted in 2021 by the Buhari-led administration to “provide for the legal, governance, regulatory, and fiscal framework for the Nigerian Petroleum Industry” and cater for the affected host communities.

In a press release dated July 17, 2025, and signed by Comrade Nelson Nnanna Nwafor, the Executive Director of FENRAD, the rights group has urged the federal government to collaborate with the grassroots to allocate sensitive budget funds to the oil-producing South-eastern states.

“The Foundation for Environmental Rights, Advocacy & Development (FENRAD) an Environmental Rights Advocacy Organization has called for greater transparency, accountability, and community participation in the implementation of the Host Community Development Trust Funds (HCDTFs) as provided for under the Petroleum Industry Act (PIA), 2021.

“As the PIA mandates the creation of HCDTFs to ensure oil-bearing communities benefit directly from petroleum operations, FENRAD urges that budgetary allocations to host communities in the oil bearing communities in Southeast zone must reflect the real needs and priorities of the people. This can only be achieved through genuine community needs assessments involving traditional institutions, community-based organizations, youth and women’s groups, and other local stakeholders,” FENRAD added.

While speaking at a Stakeholders’ dialogue on the implementation and community engagement of the Host Community Trust Fund in Port Harcourt, Comrade Nwafor, the group’s executive director, argued that the implementation of the trust funds “must be transparent, with clear reporting and monitoring mechanisms to track how funds are allocated and utilised.” The executive director suggests the following to ensure the Petroleum Industry Act (2021) delivers on its promise of inclusive development and peaceful coexistence:

Inclusive Representation on Trust Boards

Ensure community representatives on the Board of Trustees are elected transparently by the people and include women, youth, traditional rulers, and persons with disabilities.

Rotate leadership roles among different segments of the host communities to promote inclusion and equity.

Community Needs Assessment (CAN) and Participatory Planning

Carry out thorough, periodic needs assessments to identify real and current development priorities.

Involve community-based organizations (CBOs), religious groups, women and youth associations in identifying and prioritizing projects.

Capacity Building and Civic Education

Train community members on financial literacy, governance, and oversight responsibilities.

Raise awareness of the provisions of the PIA, especially regarding their rights and roles under the Trust Fund mechanism.

Transparency and Access to Information

Regular disclosure of financial flows to and from the Trust Funds, Independent audits and community scorecards.

Publish annual budgets, project plans, procurement processes, and expenditures for community review.

A strict adherence to the 3% operating expenditure commitment to host communities by oil companies

Use town hall meetings, radio announcements, and notice boards to disseminate financial reports and implementation updates.

Grievance Redress Mechanisms

Establish functional and accessible grievance mechanisms to handle complaints about fund mismanagement or exclusion from processes.

Ensure these mechanisms are culturally appropriate and trusted by the community.

Monitoring and Evaluation by the Community

Create Community Project Monitoring Committees to track progress and report any irregularities.

Encourage partnerships with local CSOs for independent monitoring and social audits.

Promote coordination between community leaders, local governments, and development organizations to align Host Community Trust projects with broader development goals.

Involve NGOs in technical support, policy dialogue, and capacity development.

Ensure Equity in Project Distribution

Develop a transparent formula to ensure equitable distribution of projects and funds among all segments of the host communities, including marginalized or smaller settlements

Capacity building for community members to engage in participatory budgeting and monitoring should be serious integrated for community ownership and participation

The Foundation for Environmental Rights, Advocacy and Development (FENRAD) also reiterated its commitment to supporting communities and government agencies in “ensuring that the HCDTFs become a tool for development, peace, and justice in Nigeria’s oil-bearing regions especially in the oil bearing communities in the Southeast Region.”