By Gift ChapiOdekina, Abuja
The House of Representatives Committee on the South-South Development Commission has intensified 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 fast-track development across the South-South region.
The committee resumed its public hearing on Wednesday, bringing together government agencies, petroleum regulators, oil industry operators and other stakeholders to scrutinise the proposed amendment and ensure that the legislation reflects broad stakeholder input before its consideration by the House.
Chairman of the Committee, Rep. Julius Pondi, explained that the hearing was reconvened after several critical stakeholders were unable to attend the initial session held on July 8 due to their participation in the Nigerian Oil and Gas (NOG) Conference.
He said the committee considered it necessary to provide all relevant stakeholders, particularly those in the oil and gas industry, the opportunity to contribute to the legislative process because of the sector’s strategic importance to the proposed amendment.
Pondi reaffirmed the House of Representatives’ commitment to transparent, inclusive and participatory lawmaking, stressing that public hearings provide an avenue for government institutions, industry players, professional bodies, civil society organisations and host communities to shape legislation through constructive engagement.
According to him, the amendment seeks to broaden the funding sources of the South-South Development Commission to enable it to effectively fulfil its mandate of driving sustainable development across the region.
He noted that despite serving as the nation’s economic hub through petroleum production, maritime commerce and industrial activities, the South-South continues to grapple with serious developmental challenges, including poor infrastructure, environmental degradation and socio-economic concerns that require sustained intervention and adequate financial support.
Pondi assured stakeholders that every memorandum and presentation submitted would be carefully examined before the committee makes its recommendations to the House, adding that the objective is to produce legislation that is equitable, practical and capable of advancing the developmental aspirations 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.
However, stakeholders from the petroleum sector expressed reservations over aspects of the proposed funding model, particularly a provision requiring oil and gas producing companies operating within the South-South to contribute three per cent of their total annual budgets to the Commission.
Presenting the position of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Commission Chief Executive, Mrs. Oritsemeyiwa Eyesan, represented by the Head of Regulations and Statutory Compliance, Kingsley Chikwendu, said the Commission supports a transparent, predictable and sustainable funding framework for the South-South Development Commission.
He, however, argued that the phrase “total annual budget” was not clearly defined in the proposed amendment, creating uncertainty over how contributions would be assessed, payment obligations determined, deductions applied, timelines enforced and how companies operating across multiple regions or under joint venture arrangements would be treated.
Chikwendu warned that implementing the proposal in its current form could amount to another expenditure-based levy payable regardless of a company’s profitability, production levels or financial condition.
He further noted that upstream petroleum operators already shoulder several statutory obligations, including royalties, petroleum taxes, the Niger Delta Development Commission (NDDC) levy, Host Community Development Trust Fund contributions under the Petroleum Industry Act (PIA), Nigerian Content Development Fund contributions, environmental remediation responsibilities and abandonment fund payments.
The NUPRC therefore urged lawmakers to conduct a thorough assessment of the proposed levy and its likely impact on production costs, investment decisions and the competitiveness of Nigeria’s upstream petroleum industry.
Similarly, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) advised the committee to ensure that any new funding mechanism aligns with the fiscal principles and investment objectives of the Petroleum Industry Act, 2021.
Presenting the Authority’s position, Senior Manager, Ahmed Laido, said any additional financial obligation should strengthen regulatory certainty, encourage long-term investment, boost 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 to ensure that the funding framework supports the developmental goals of the South-South Development Commission without undermining the sustainability and global competitiveness of Nigeria’s petroleum industry.
Also speaking, the Oil Producers Trade Section (OPTS) of the Lagos Chamber of Commerce and Industry cautioned against introducing another statutory levy on oil and gas operators.
Its Chairman, Bala Wudiri, argued that operators are already making significant statutory contributions through existing laws, including payments to the NDDC and the Host Community Development Trust Fund established under the Petroleum Industry Act.
He warned that imposing an additional three per cent contribution could increase the financial burden on operators, duplicate existing obligations and reduce Nigeria’s attractiveness as a destination for oil and gas investment.
Wudiri called for greater clarity on the proposed funding model and urged the committee to adopt a balanced approach that would strengthen the Commission’s financial capacity without discouraging investment or creating overlapping statutory obligations.
The hearing ended with stakeholders expressing broad support for efforts to enhance socio-economic development in the South-South, while maintaining differing views on the most sustainable funding mechanism for the Commission.
Participants agreed on the need to strengthen the Commission’s capacity to deliver infrastructure and development projects but urged lawmakers to strike a balance between achieving development objectives and preserving a stable, competitive and investment-friendly operating environment for Nigeria’s petroleum sector.
The committee is expected to review all memoranda and submissions before presenting its recommendations to the House of Representatives for further legislative action.
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