NDDC Vs stiff-necked debtors By Ray Ekpu



The paradox of the Niger Delta region has been firmly etched in the psyche of the people who inhabit it. It holds stupendous oil and gas wealth in its bowels but its people are extremely poor and deprived. The twin functions of oil exploration and exploitation have polluted the water, fouled the air, killed the farms and the fishes and reduced the region to a soul-stifling entity with a perpetual frown. This cash cow can be compared to the man who lives on the banks of a river but washes his hands with spittle. Since the discovery of oil in the region 61 years ago and its exportation two years later the fate of the people and its ecosystem has received life threatening knocks. The people’s misery was stinking like an untreated sore. The region could be described without much exaggeration as the headquarters of sorrow. After several pitched battles, several protests and several political permutations by several governments at the centre the Niger Delta Development Commission (NDDC) was born. Its mandate was for it, along with other development partners, to make a positive intervention in the region’s development process as well as cure it of its environmental and ecological deficiencies. But this baby was not exactly a bouncing baby boy or girl. It was a baby born with some defects and those defects were to manifest themselves later. They have now come to bite us.

At present there is a conflict between the NDDC and the NLNG Limited, a gas processing company in the region. The Niger Delta Development Establishment Act of 2000 stipulates specific contributions to be made by the Federal Government as well as oil and gas companies to the NDDC to enable it execute its statutory mandate. By the provisions of Section 14 (2) (6) of the NDDC Act, “gas processing companies” operating in the petroleum industry are specifically required to pay to the NDDC fund “3% of their annual budgets.”

Some of the oil companies manage to find ingenious ways of paying less than they ought to pay, thus short-changing the NDDC. Some default by not paying at all for one reason or the other. The NLNG Limited belongs here. This company is the biggest natural gas liquefaction company in Nigeria and every year it posts a profit of not less than N500 billion. There is nothing with a company making humongous profits. Both the NDDC and NLNG Limited have gone through the entire gamut of our court system all the way to the Supreme Court. It appears that the NLNG Limited had managed to find some technical lacuna in the law and used that canopy to evade its responsibility to the NDDC, and the Niger Delta people. This problem apparently arose from some terminological inexactitude in the law. The NLNG says it is not a “gas processing company” in the context of the NDDC Act but in what context is it a gas processing company? It also claims that it is not subject to any new laws, taxes, dues or other obligations enacted or prescribed in Nigeria after 1993 except such taxes, laws or obligations are generally applicable to all companies registered in Nigeria because a special exemption was granted to it under the Nigeria LNG (Fiscal Incentive, Guarantees and Assurances) Act of 2004. The NLNG has added a third reason for non-payment which sounds ridiculous namely that the NLNG does not have an “annual budget” as envisaged by the NDDC Act from which it would be expected to pay 3%. Is there any limited liability company in the world that does not have an annual budget or is this just an exercise in legal sophistry to enable it evade its financial obligation to the NDDC? It appears that the NLNG wants only the roses without the thorns, the profits without the responsibility. By the laws of its universe the company prefers to stay in a steady hum of happiness while its operating constituency wallows in discontent that can lead to an uncontrollable explosion that may even affect its operati


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