Eight Oil Producing States Get N377.9bn From Oil Derivation Fund

Eight oil-producing states in Nigeria received N377.9 billion as 13% of the oil derivation fund in the first half of 2022.

The states are Abia, Akwa Ibom, Bayelsa, Delta, Edo, Imo, Ondo, and Rivers.

The amount received in the review period is 46.9% higher than the N257.2 billion shared in the second half of 2021 and a 97.4% increase when compared to the corresponding period of 2021 (N191.4 billion).

Notably, the 13% oil derivation is a financial incentive enshrined in section 162, sub-section 2 of the Nigerian constitution for oil-producing communities, based on their production input, in a bid to encourage them to create enabling environment for more exploration in their regions.

The fund shared by the communities has increased significantly despite the non-remittance of funds by the Nigerian National Petroleum Corporation (NNPC) to the Federation Account (FAAC).

The amount shared in the first six months of 2022 is already 84.2% of the total N448.67 billion shared in the whole of 2021.

A further breakdown of the data showed that Delta State received the largest share during the period, accounting for 30.4% of the total amount shared by the eight states.

In terms of year-on-year increase, Edo State recorded the highest increase in their inflows, increasing by 160.5% year-on-year.

Delta State received the highest share, receiving a whooping N114.75 billion between January and June 2022, which accounts for 30.4% of the total amount shared among the eight states.

Also, Delta State saw its share improve by 79.7% year-on-year compared to the N63.84 billion received in H1 2021. The state received N141.9 billion in the whole of 2021.

Akwa Ibom State followed with an income of N80.02 billion, which represents 21.2% of the total amount shared.

Bayelsa received a sum of N76.74 billion as part of the 13% oil derivation, accounting for 20.3% of the total shared amount. It also grew by 114.2% year-on-year compared to N35.83 billion received in the corresponding period of 2021.

Other states who received part of the funds include Rivers (N70.44 billion), Edo (N14.51 billion), Ondo (N9.47 billion), Imo (N8.16 billion), and Abia (N3.84 billion).