By Aaron Ossai
The House of Representatives Committee on the South-South Development Commission has stepped up consultations with key stakeholders on a proposed amendment to the South-South Development Commission (Establishment) Act, 2025, aimed at strengthening the Commission’s funding framework to drive sustainable development across the region.
At the resumed public hearing on Wednesday, the committee engaged government agencies, petroleum regulators, oil industry operators and other stakeholders to examine the proposed amendment and ensure the legislation benefits from broad stakeholder input before consideration by the House.
Chairman of the Committee, Hon. Julius Pondi, said the hearing was reconvened after several critical stakeholders were unable to attend the initial session on July 8 because they were participating in the Nigerian Oil and Gas (NOG) Conference.
He noted that, given the strategic importance of the oil and gas sector to the proposed legislation, the committee considered it necessary to give all relevant stakeholders an opportunity to contribute to the legislative process.
Pondi reaffirmed the House of Representatives’ commitment to a transparent, inclusive and consultative lawmaking process, stressing that public hearings remain essential for enabling government institutions, industry players, professional bodies, civil society organisations and host communities to shape legislation through constructive engagement.
According to him, the proposed amendment seeks to broaden the funding sources of the South-South Development Commission to enhance its capacity to deliver on its mandate of promoting sustainable development across the region.
He observed that although the South-South remains Nigeria’s economic hub through petroleum production, maritime activities and other strategic industries, it continues to grapple with infrastructure deficits, environmental degradation and socio-economic challenges that require sustained institutional support and adequate funding.
Pondi assured stakeholders that every memorandum and presentation submitted would be carefully considered before the committee presents its recommendations to the House, adding that the goal is to produce balanced, practical and equitable legislation that advances the development of the South-South while protecting the national interest.
“We are particularly interested in receiving constructive contributions on the proposed funding framework, its sustainability, its implications for government and industry, as well as alternative proposals that can further strengthen the objectives of the legislation,” he said.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), represented by the Head of Regulations and Statutory Compliance, Kingsley Chikwendu, expressed support for a predictable, transparent and sustainable funding model for the Commission.
However, the Commission raised concerns over the proposal requiring oil and gas producing companies operating in the South-South to contribute three per cent of their total annual budgets to the Commission.
According to the NUPRC, the term “total annual budget” is not defined in the amendment, creating uncertainty over the basis for assessment, liability determination, deductibility, payment timelines, enforcement mechanisms and the treatment of joint venture operations and companies with assets across multiple regions.
Chikwendu warned that, if adopted in its current form, the proposal could amount to an additional expenditure-based levy payable regardless of profitability, production levels or the financial health of affected companies.
He noted that upstream operators already meet several statutory obligations, including royalties, petroleum taxes, the Niger Delta Development Commission levy, Host Community Development Trust Fund contributions under the Petroleum Industry Act, the Nigerian Content Development Fund, environmental remediation commitments and abandonment fund contributions.
The Commission urged lawmakers to undertake a comprehensive assessment of the proposed levy’s potential impact on production costs, investment decisions and the competitiveness of Nigeria’s upstream petroleum sector before taking a final decision.
Similarly, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), represented by Senior Manager Ahmed Laido, advised the committee to ensure any additional funding mechanism aligns with the fiscal objectives and investment philosophy of the Petroleum Industry Act (PIA) 2021.
Laido said any new financial obligation should promote regulatory certainty, encourage long-term investment, strengthen investor confidence and complement the Federal Government’s ease-of-doing-business reforms in the petroleum sector.
He urged lawmakers to carefully consider the broader economic implications of the proposal, stressing that the funding framework should support the Commission’s development objectives without undermining the sustainability and global competitiveness of Nigeria’s petroleum industry.
The Oil Producers Trade Section (OPTS) of the Lagos Chamber of Commerce and Industry also cautioned against imposing another statutory levy on oil and gas companies.
Speaking on behalf of the association, Chairman Bala Wudiri argued that operators already make significant statutory contributions through existing frameworks, including payments to the Niger Delta Development Commission and the Host Community Development Trust Fund established under the Petroleum Industry Act.
He warned that an additional three per cent contribution could increase operating costs, duplicate existing obligations and reduce Nigeria’s attractiveness as an investment destination for the oil and gas industry.
Wudiri called for greater clarity on the proposed funding mechanism and urged lawmakers to adopt a balanced approach that strengthens the Commission’s financial capacity without discouraging investment or creating overlapping statutory obligations.
The resumed public hearing highlighted broad support among stakeholders for the socio-economic development of the South-South, while revealing differing views on the most appropriate and sustainable funding model for the Commission.
Participants generally agreed on the need to strengthen the Commission’s capacity to deliver critical infrastructure and development projects but urged lawmakers to strike a balance between regional development goals and maintaining a stable, competitive and investment-friendly environment for Nigeria’s petroleum industry.
The committee is expected to review all submissions before presenting its recommendations to the House of Representatives for further legislative consideration.
