Anambra State joins 13% oil derivation fund bounty sharing

…To share with Kogi State three oil wells on 50-50% basis

By Ezurike Ugochukwu

Anambra State has on the basis of a recent federal government declaration joined the league of oil producing states in the country qualified for the 13 percent revenue derivation.

This is sequel to the approval of 11 oil wells wholly to Anambra state by the Revenue Mobilization Allocation and Fiscal Commission (RMAFC).

In a letter signed by M.B Shehu, secretary to RMAFC, and dated August 24, 2021 in response to Governor Willie Obiano’s request.

for due share of revenue accruing to the nation from oil and gas production activities in Anambra State.

It also approved the attribution of Anambra River One, Two and Three oil wells, to be shared on 50-50 per cent basis between Anambra and Kogi states, pending the final delineation of boundaries of the two states.

The 11 oil wells attributed to Anambra State are Nzam-One oil well, Alo-One oil well and Ogbu-One oil well.

Others are Ameshi One, Two, Three and Four oil wells, as well as Enyie One, Two, Three and Four oil wells.

The Revenue Mobilisation and Fiscal Commission’s approval was made at its 139th plenary held on July 27.

In the letter referenced: RMC/O&G/48/VOL/I/55 addressed to Gov. Obiano, implies that Anambra has officially joined the list of oil producing states in the country and therefore eligible for the 13 percent derivation fund.

The letter said the 13 per cent derivation will take effect when the revenue from the operations of the oil wells starts contributing to the federation account.

It further approved the attribution of Anambra River one, two and three oil wells to be shared on fifty percent basis between Anambra and Kogi — pending the final delineation of boundaries between the two states.

The 13 percent derivation fund comes from the federation revenue to oil-producing communities through the state governments as enshrined in section 162, sub-section 2 of the Nigerian Constitution.

“I wish to refer to your letter dated 24th March, 2021 on the above subject and to inform you that the commission at its 139th plenary session held on 27th July 2021 approved the attribution of the following oil wells to Anambra State: Nzam-1 oil well, Alo-1 Oil well, Ogbu-1 oil well, Ameshi 1, 2, 3 and 4 oil wells, Enyie 1, 2, 3 and 4 oil wells,” the letter reads.

“Furthermore, the Commission also approved the attribution of Anambra River 1, 2 and 3 oil wells on a 50:50 percentage basis between Anambra and Kogi States pending the final delineation of the boundary between the two States.

“Accordingly, Anambra State will start to benefit from the 13% Derivation fund as soon as proceeds from the operation in the above named oil wells starts contributing revenue into the Federation Account.”

Oil producing states

In the last 10 years(2009 to 2019), reports have bore how eight oil-producing states including Abia, Akwa-Ibom, Bayelsa, Delta, Edo, Imo, Ondo and Rivers received and shared N6.589 trillion from the federation account under the 13 percent derivation principle.

In 2020 alone, the current eight oil producing states recieved and shared N454 billion.