Delta oil communities threaten showdown over $2.4bn shortfall

Tensions are mounting in Delta State as host communities under OML 26 have threatened to take action against oil operators over alleged underfunding of development initiatives.

The communities, under the umbrella of Isoko Grassroots Mobilizers, accused the Asset Management Team led by Sterling Global Oil Exploration and Energy Company, in collaboration with NNPC Exploration and Production Limited (NEPL), of failing to comply with provisions of the Petroleum Industry Act 2021 (PIA).

In a statement issued on April 20, the group alleged that the operators underpaid contributions to the Host Community Development Trust (HCDT), which is entitled to three per cent of annual operating expenditure for community development.

According to the group, a remittance made in October 2025—nearly two years after the trust’s inauguration—fell short by about ₦2.4 billion.

They said the Board of Trustees of the HCDT raised concerns over the shortfall in November 2025, but efforts to resolve the issue, including meetings with the operators, failed to yield results.

The dispute was later escalated to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which convened a tripartite meeting in Abuja on April 15, 2026. However, the meeting ended without a definitive resolution, with the regulator directing NEPL to provide further documentation on alleged expenditures.

The oil firms reportedly claimed that the shortfall had been utilised for “special intervention projects,” a position the communities rejected as inconsistent with the PIA and existing agreements.

The group also expressed concern over what it described as a lack of development in OML 26, noting that no significant projects had been executed since the Host Community Development Trust was inaugurated in February 2024.

They warned that continued delays in remitting the funds could lead to a shutdown of oil operations in the area, despite acknowledging the broader implications of such actions.

“We can no longer wait endlessly for development that is not forthcoming,” the group said, citing years of neglect, lack of electricity, and poor infrastructure in the host communities.

The communities called on relevant government agencies to compel the operators to remit all outstanding funds and resolve the dispute to prevent escalation.

The development highlights growing tensions in Nigeria’s oil-producing regions, where host communities continue to demand greater accountability and tangible benefits from resource extraction activities.