13% Derivation: How 9 Oil-Producing States Shared N450.60 Billion In 2021.
Through the 13 percent derivation formula, Nigeria’s nine oil-producing states shared N450.60 billion from the federal account in 2021.
Delta, Akwa-Ibom, Bayelsa, Rivers, Edo, Ondo, Imo, Lagos, and Abia got the funds, according to the National Bureau of Statistics (NBS).
As stipulated in section 162, sub-section 2 of the Nigerian constitution, the 13 percent derivation fund is derived from federal revenue and distributed to oil-producing communities through state governments.
The state of Delta got the most money, totaling N141.93 billion, or 31% of the total earnings from the derivation account.
Delta is closely followed by Akwa Ibom, which got N91.16 billion over the time, accounting for 20% of the entire distribution.
Bayelsa (N87.23 billion), Rivers (N83.12 billion), Edo (N17.12 billion), Ondo (N11.50 billion), Imo (N9.98 billion), Abia (N4.78 billion), and Lagos (N4.78 billion) are among the other states (N3.78 billion).
The 13 percent derivation fund differs from the three percent set aside in the PIA for host communities from the oil company’s operating expenditures (OPEX).
Despite the 13 percent derivation, oil-producing countries continue to struggle with huge domestic debt and severe infrastructure deterioration, among other issues.
The states of Lagos, Rivers, and Akwa Ibom are unusual instances.
Lagos leads with a total debt of N532.12 billion, followed by Akwa Ibom and Rivers States with N234.85 billion and 226.35 billion, respectively, at the end of Q3 2021, according to the Debt Management Office (DMO).
Imo, Bayelsa, Abia, Edo, and Ondo State, with N151.31 billion, N145.80 billion, N89.30 billion, N80.22 billion, and N65.42 billion, respectively, have the highest internal debt.
No other oil-producing states made the top ten list of indebted states, with the exception of Lagos ($1.41 billion) and Edo ($280.29 million) (external debts).