Niger Delta Fund Initiative Program:
Proposal - October 2006

Explanatory/Concept Note

Dear All,

Due to endemic corruption and poor governance, oil royalties, particularly the monthly 13% oil revenue derivation allocation from the Federation account, have not been utilized transparently and equitably by the Niger Delta States Governments. A substantial portion of these huge funds have gone into private hands and bank accounts in Nigeria and in western countries while the people are consigned to embarrassing degrading poverty.

The policies put forth in this bill titled “BAYELSA STATE OIL FUND COMMISSION) will bring increased prosperity to local oil bearing communities and the state in general, substantially decrease conflict in the region, and provide security for oil production.

While all the eight local areas of Bayelsa State are oil producing areas, special attention should be given to direct oil producing communities who bear the brunt of any oil spill.

In many reference workshops organized across the Niger Delta on issues of good governance and oil revenue appropriation, participants agreed to the setting up of an institutional mechanism whereby the 13% oil revenue can be transparently administered rather than lumped into the normal monthly state allocations. This way, it is agreed that identifiable projects could be embarked upon in oil bearing communities and people can easily ask questions. Ondo State already has such a body with an excellent track record of project execution and transparency.

This proposal should not be confused with past Agencies like the Petroleum Trust Fund (PTF) Oil Mineral Producing Areas Development Commission (OMPADEC) or even the current NDDC etc which are controlled by the Federal Government at Abuja without a say by the local communities.

It should be noted that this Bill is being presented to Ijaws in the Diaspora for inputs, which would hereafter, be subjected to a public consultative forum in Yenagoa before finally presented to the State House of Assembly thus engaging a broad spectrum of civil society in this governance issue.

Please, be free to make your inputs within the next 14 days and email it to me copying the following email addresses:

Signed: August 10th, 2006
Gordon Abiama, Director,
Africa Centre for Geoclassical Economics,
Yenagoa, Bayelsa State
Tel/fax: 234-89-490-326, Cell Ph: 0803-668=5652





This draft Bill forms the revised version of the proposed Niger Delta Fund Initiative paper (see Africa Section)




BE IT ENACTED by the Bayelsa State House of Assembly as follows:


1. Establishment of the Commission

  1. There is hereby established a body to be known as the Bayelsa State Oil Fund Commission (in this law referred to as the “Commission”).
  2. The Commission shall:
    1. be a body corporate with perpetual succession and a common seal; and
    2. may sue and be sued, in its corporate name.

2. The Commission shall consist of
  1. The Chairman who shall be an indigene of an Oil Producing Community of the State;
  2. Three (3) members representing each of the original Eight (8) Local Government Areas;
  3. Three (3) representatives each of Religious and Civil Society Organizations
  4. Six (6) ex-officio members namely;
    1. representative of the Ministry of Finance
    2. representative of the Ministry of Lands and Housing
    3. representative of the Ministry of works.
    4. representative of the Bayelsa State Traditional Rulers Council
    5. representative of Ijaw Youth Council (IYC)
    6. representative of Ijaw National Congress (INC)

3. Secretariat
  1. The Commission shall have its head office in Yenagoa and
  2. Area offices in each senatorial district

4. Appointment and Tenure of Office
  1. The Chairman and other members of the Commission shall be appointed by the Governor subject to confirmation by the Bayelsa State House of Assembly.
  2. The Chairman shall be the Chief Executive of the Commission and shall hold office for a period of four (4) years and may be re-appointed for another period of four years only;
  3. All ex-officio members of the Commission shall hold office during their tenure of office;
  4. The three (3) representatives each of the original Eight (8) Local Government Areas shall;
    1. be on part-time basis
    2. hold office for a period of four years and may be re-appointed for another period of four years only.
  5. Remunerations
    There shall be paid to the Chairman and every member of the Commission such remunerations, salary and allowances as the State Executive Council may from time to time approve;
  6. Supervision and Control
    The Commission shall in the performance of its functions under this law be subject to the direction, control or supervision of the Governor. PROVIDED that the commission shall submit annual report of its activities to the House of Assembly first for approval.
  7. Schedule
    The Supplementary provision contained in the schedule to this law shall have effect with respect to the proceedings of the Commission and the other matters contained therein.

5. Cessation of Membership The office of the Chairman and/or a member of the Commission other than an ex-officio member shall become vacant if-
  1. He resigns his membership by notice in writing to the Governor and that member shall on the date of the receipt of the notice by the Governor cease to be member,
  2. He is adjudged or declared bankrupt under any law in force in any part of Nigeria;
  3. Under any law in force in Nigeria, he is adjudged to be a lunatic or otherwise declared to be of unsound mind;
  4. He has absented himself from three consecutive meetings of the Commission without a written permission;
  5. He is otherwise disqualified by any law in force in the State
  6. He is removed from office by the Governor.


6. Functions of the Commission The Commission shall:
  1. Receive and administer exclusively the 100% of the 13% oil derivation fund accruing to the Bayelsa State Government for;
    1. the rehabilitation and physical development of the state. However direct oil bearing communities shall, in the beginning be granted a preference focus in order to remediate and develop the devastations occasioned by oil extraction. As improvements are made in these areas, funds will be directed to other communities of the state in no less than a three year period after the establishment of the fund, and
    2. other developmental projects as may be determined from time to time by the Commission in consultation with the oil producing communities.
    3. and to ensure that the interest of future generations of Bayelsans are safeguarded, oil being a non renewable resource.
  2. Liaise with the relevant Federal Government and State Government authorities on the control and effective methods of tackling the problems of coastal erosion, oil pollution, spillages and other environmental problems in the oil producing areas of the State.
  3. Ensure fair and equitable distribution of development projects in the eight (8) LGAs which are all oil producing areas.
  4. Ensure the judicious utilization of the fund accruing to the Commission.
  5. Enlighten the Communities in the oil producing areas of the State on the functions, policies and activities of the Commission.
  6. Set aside a prescribed percentage of funds accruing the state to providing low interest loans to medium and small scale industries in the state.
  7. The Commission shall adopt a medium and long-term expenditure plan that classifies how the Commission’s funds portfolio will be used to combat poverty, reform the educational system and the environmentally challenged communities. Adopt a law on public access to the Commission’s books and hold public hearings to gauge public opinion on spending priorities.
  8. Execute such other works and projects and perform such other functions which in the opinion of the Commission are necessary for the sustainable development of the Oil producing Areas of the State.

6:2 Transparency and Accountability The Commission shall:
  1. Ensure transparency by publishing a web site where its activities are published including the full annual report of the Commission and the Auditor’s report. Quarterly reports should also be made available via the website and hard copies
  2. The web site should keep current all monies received by the Fund and all investment and distribution activities of the Fund; the history of the development of the Fund, its incorporation, details concerning its management, and other up-to-date information regarding the Fund.
  3. The web site should also list the date, time and place for the quarterly hearings for citizens input concerning Fund operation and the oil derivative revenue allocation. Such announcements should be listed on the web site at least one month prior to the scheduled hearings.
  4. The web site should contain teaching material to educate students of all ages and all others about the Fund. The web site should be interactive so that Bayelsa State citizens can ask questions and receive individual responses regarding any and all aspects of the Fund.
  5. All individuals, groups, organizations or agencies that are allocated monies from the Fund shall also be listed on the web site along with their budget accounts of funds received and how they were both proposed to be utilized initially and how they were in fact utilized within one year after their receipt.

7. Power of the Commission The Commission shall have power to:
  1. Manage and supervise the affairs of the Commission;
  2. Enter into Contract as may be necessary or expedient for discharge of its functions and ensure the efficient performance of the functions of the Commission in accordance with the government financial regulations;
  3. Establish and maintain such number of departments as it may deem fit for the effective discharge of its functions;
  4. Pay the Staff of the Commission such remuneration and allowances as appropriate;
  5. Make rules and regulations for carrying out the functions of the Commission;
  6. Do such other things as are necessary and expedient for the efficient performance of the functions of the Commission.


8. Appointment and Functions of Secretary
  1. There shall be a Secretary of the Commission, who shall be appointed by the Governor of the State subject to confirmation by the State House of Assembly and shall be an indigene of an oil producing community of the State.
  2. The Secretary shall
    1. be the accounting officer of the Commission;
    2. subject to the general direction of the Commission maintain disciplinary control over the staff of the Commission.
  3. Carry out the day to day activities of the Commission and
  4. Shall carry out such other duties as may be directed from time to time by the Chairman.

9. Appointment of Staff and Allowances
  1. The Commission shall
    1. have power to employ directly such number of staff as it may require or post from any civil or public department of the State, such number of employees to assist the Commission in the discharge of any its functions under this law.
    2. Pay to persons so employed such salaries and allowances as it may determine from time to time, provided that such salaries and allowances are not less than what obtains in the public service of the State.
  2. Persons employed by the Commission shall in respect of their service in the Commission be entitled to pensions, gratuities and other retirement benefits as obtains in the Public Service of the State.
  3. Contract Appointment Nothing in subsections (i) and (ii) above shall prevent the appointment of a person to any office on terms which may preclude the grant of pension and gratuity in respect of that office.


  1. Funds and Account II The sources of fund of the Commission shall be:
    1. 100% of the oil derivation fund accruing to the Bayelsa State Government from the Federation Account;
    2. any other source of funds accruable to it under any law in force in the State;
    3. all other assets that may from time to time accrue to the Commission.
    4. donations from donor agencies and NGOs.
  2. The Commission may with the approval of the Governor accept gifts, donations, grants, land and any other testamentary disposition on such terms and conditions as may be specified provided that such terms and conditions are not onerous and/or in conflict with the effective performance of the functions of the Commission.
  3. The fund shall be managed in accordance with the rules made by the Commission subject to the financial regulations applicable in public service of the State and without prejudice to the generality of the power to make rules under this section, the rules shall in particular contain provisions:
    1. specifying the manner in which the assets of the Commission are to be held and regulating the mode of payment into and out of the fund; and
    2. requiring the keeping of proper accounts and records for the purpose of the fund.
  4. The Secretary to the Commission shall in each financial year prepare estimate of recurrent and capital expenditure, and when approved by the Commission, shall forward it to the Governor who in turn will present same to the State House of Assembly.
  5. The Secretary to the Commission shall keep proper accounts and records in relation thereto.
  6. Adopt a law on public access to the Commission’s books and hold quarterly public hearings to gauge public opinion on spending priorities. These public hearings to be held not only in Yenagoa but in other parts of the state as well.
  7. Appointment of Independent Auditor and Publication of Report
    1. The Governor shall each final year appoint an independent auditor for the purpose of auditing the total revenue which accrued to the Commission for that year from the State Government and other sources, in order to determine the accuracy of payments, receipts and expenditure.
    2. The independent auditor appointed under subsection (a) shall be engaged on such terms and conditions as the House of Assembly may approve.

10. Expenditure of the Commission The Commission may from time to time apply the proceeds of the fund established pursuant to section II of this law to:
  1. The cost of administration of the Commission;
  2. The payment of salaries, fees and remunerations, allowances, pensions and gratuities payable to members and employees of the Commission.
  3. The payment for contracts, includes mobilization fluctuations, variations, legal fees and cost on contract administration.
  4. The payment for purchases; and
  5. Undertake such other activities as are connected with all or may of the functions of the Commission under this law.

11. Borrowing Power The Commission may with the consent of the Governor borrow on such terms and conditions such sums of money as the Commission may require in the exercise of the functions conferred on it under this law. Any funds borrowed must be against expected revenue from oil derivative only and are in no way to be repaid from the income of the labour of the people.

12. Limitation of the Suit Against the Commission
  1. Notwithstanding the provision of any other law, no cause of action shall be instituted against the Commission, any member of the Board or any employee of the Commission in respect of any duty performed or any authority exercised or any alleged neglect or default in the performance of any duty or exercise of any authority in any Court, unless such action is commenced within three(3) months next after the act, neglect or default complained of is caused. In the case of a continuous damage or injury such action shall lie within three months from the abatement of such damage or injury.
  2. No suit shall be commenced against the Commission before the expiration of a period of one (1) month after written notice of intention to commence the suits shall have been served upon the Commission by the intending plaintiff or his agent, and the notice shall clearly and explicitly state the cause of action, the particulars of the claims, the name and place of abode of the intending plaintiff(s) and the relief which he claims.

13. Service Of
  1. The notice referred to in section 12 (ii) of this law and any summons, notice or any other documents required or authorized to be served upon the Commission under the provisions of the this law or any other enactment or law may be served by delivering the same to the Chairman or the Secretary of the Commission or by sending it by registered post addressed to the Secretary at the Head Office of the Commission.

14. Restriction on Execution Against the Property of the Commission
  1. In any action or suit against the Commission. on execution or attachment or process in the nature thereof shall be issued against the Commission and any sum of money which may by the judgment of the Court be awarded against the Commission shall subject to any directive given by the Court where notice of appeal has not been given by the Commission be paid from the general fund of the Commission.

15. Indemnity of Member of the Commission and Employees of the Commission
  1. Every member of the Commission, agent, auditor or employee, for the time being shall be indemnified out of the assets of the Commission against any liability incurred by him in defending the Commission in any proceedings whether civil or criminal, if such proceeding is brought against him in his capacity as such member, agent, auditor or employee aforesaid.

16. Offices and Premises of the Commission
  1. For the purpose of providing necessary offices and premises for the performance of its functions under this law, the commission may subject to the Land Use Act:-
    1. Purchase or take on lease any interest in land or other property, and
    2. Construct offices and premises and equip and maintain same.
    3. Sell or lease out any office or premises held by it.

17. Annual Report
  1. The Commission shall prepare and submit to the Governor and House of Assembly not later than 30th June in each year, a report in such form as he may direct on the activities of the Commission during the preceding year.

18. Saving Clause
  1. As from the commencement of this law, all rights, interests, obligations and liabilities of the dissolved Commission existing before the commencement of this law under any contract or instrument or law or equity shall by virtue of this law be deemed to have been vested in the Commission under this law.

19. Interpretation In this Law, unless the context otherwise requires-“Chairman” means the Chairman of the Commission. “Commission” means the Bayelsa State Oil Fund Commission (BASOFCO) established by Section 1 of this law. “Member” means a member of the Commission and it includes the Chairman. “Secretary” means the Secretary to the Commission.

20. Citation This Law may be cited as the Bayelsa State Oil Fund Commission Law 2006.


Proceedings of the Commission

1. The Commission shall meet for the conduct of its business at such time as it may it may determine.

2. The Commission shall meet:
  1. Whenever it is summoned by the Chairman;
  2. if the Chairman is required to do so by notice given to him by not less than three(3) members.

3. The Commission shall have power to regulate its proceedings and may make standing orders for that purpose and subject to any standing orders and to paragraph 4 of this schedule, may function notwithstanding-
  1. any vacancy in its membership or the absence of any member,
  2. any defect in the appointment of a member or
  3. that a person not entitled to do so took part in its proceedings.

4. The quorum at any meeting of the Commission shall be a simple majority of the members.

5. Where standing orders made under paragraph 2 of this Schedule provide for the Commission to accept persons who are not members of the Commission, such persons may attend meetings of the Commission and advise it on any matter referred to them by the Commission but shall not count towards a quorum and shall not be entitled to vote at any meeting of the Commission.

6. At any meeting of the Commission, the Chairman shall preside but if he is absent, the members present at the meeting shall appoint a member among themselves to preside at the meeting.

  1. The Commission may appoint one or more committees to advise it on the exercise of its functions under this law and shall have power to regulate the proceedings of its committees.
    1. The Committees appointed under this paragraph shall consist of such number of persons as may be determined by the Commission.
    2. The decision of the Committees shall not have effect until it is confirmed by the Commission.


  1. Any contract or instrument which if entered into or executed by a person not being a body corporate which would not be required to be made under seal may be entered into or executed on behalf of the Commission by any person generally or specifically authorized in that behalf by the Commission.
  2. Any member of the Commission or of a Committee thereof, who has a personal interest in any contract or arrangement entered into or proposed to be considered by the Commission or the Committee thereof, shall forthwith disclose his interest to the Commission or Committee, as the case may be and shall not vote on any question relating to such contract or arrangement.

  1. The Common seal of the Commission shall not be used or affixed to any document except in pursuance of a resolution duly passed at a properly constituted meeting of the Commission and recorded in the minutes of the meeting.
  2. The fixing of the seal of the Commission shall be authenticated by the signatures of the Chairman and the Secretary or some other members authorized generally or specifically by the Commission to act for that purpose.
  3. Any document purporting to be a document duly executed under the seal of the Commission shall be received in evidence and shall, unless the contrary is proved be deemed to be so executed.