The states of Imo, Abia, and Anambra have raked in a total of N8.14bn in Oil and Gas derivations paid to mineral-producing states, according to a Cable Index Report.
Imo State led the pack for the eastern region, raking in N3.62bn from the Federal Government, with Abia State and Anambra State raking in N2.87bn and N1.65bn respectively.
Delta State had the highest allocation in the country, pulling in N47.14bn, followed closely by Akwa Ibom and Bayelsa with N34.98bn and N34.41bn respectively.
The Oil and Gas derivation is a direct result of a constitutional provision under Section 162 of the 1999 Constitution, which mandates that not less than 13% of revenue from natural resources be returned to the state of origin. This is in addition to the State’s normal share of the Federation Account.
The 13% derivation rule follows years of activism and agitation by oil-producing communities in Nigeria for compensation for the environmental damage done to their immediate surroundings by Oil extraction and exploration.
The rule seeks to compensate every region bearing the brunt of the oil exploration in Nigeria, giving them something extra from their FAAC Allocations.
Beneficiary states of the 13% derivation include Akwa Ibom, Bayelsa, Delta, Rivers, Edo, Abia, Imo, Anambra, and Ondo.
Imo State is home to seven major Oil and gas companies, constituting a robust Oil and gas sector, adding to the State’s bright prospects. Governor Hope Uzodimma has called for greater physical presence by oil companies operating in Imo State.
He lamented that most of them have their headquarters elsewhere, depriving Imo State of a thriving corporate sector badly needed to employ youths and boost the state’s local economy.
Major oil and Gas players in the State include WalterSmith Petroman Limited, Anoh Gas Processing Company Limited (AGPC), and others. Imo State also has significant untapped Gas reserves, contributing to Nigeria’s resource wealth and leverage.
