Nigeria's Oil-Producing States And How Much They Get as Allocation From FG

Nigeria's Oil-Producing States And How Much They Get as Allocation From FG

  • The 36 states of Nigeria, including the Federal Capital Territory, Abuja, depend mainly on allocation from the federal government for revenue
  • Every month, the Nigerian government share funds from the federation account with each state.
  • However, some states are entitled to more than the others due to their status as oil-producing areas

By law, oil-producing states in Nigeria are entitled to a percentage allocation from the country's derivation fund every month.

The money known as the derivation fund varies each month and depends on the allocation by the Nigerian government.

Oil-producing states in Nigeria, Delta State, Edo
Oil producing states share billions monthly from Nigeria Credit: andresr
Source: Getty Images

The states get 13 per cent of the total allocation from the federation account monthly.

Allocation from Federation surge

According to the National Bureau of Statistics (NBS), the oil-producing states have received about N377.93 billion as a derivation fund from the federal government in the first half of 2022.

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The states of Abia, Akwa Ibom, Bayelsa, Delta, Edo, Imo, Ondo and Rivers have received about 46.9 per cent higher than the N257 billion shared in the second half of 2021, and a 97.4 per cent increase compared to the same period in 2021.

Reports say the 13 per cent derivation fund is a constitutional provision under section 162, sub-section 2 of the Nigerian constitution for oil-producing communities in Nigeria, and it is dependent on their production output.

In the last seven days, there has been an increase in the 13 per cent shared by the oil-producing states despite non-remittance to the federation account by Nigeria National Petroleum Company Limited (NNPC) in the last seven days.

The total amount shared in the first six months of this year stands at 84.2 per cent of the total N448.67 billion shared in the whole of last year.

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A breakdown of the federal government's amount shared with the states shows that Delta State has the highest at 30.4 per cent.

Based on year-on-year, Edo state got the highest at 160.5 per cent.

Here's how the states stand in terms of allocation.

  • Delta state: N114.75 billion between January and June 2022. It got 30.4% of the total amount shared by the eight states
  • Akwa Ibom state: N80.02 billion, 21.2% of the total amount transferred
  • Bayelsa received a sum of N76.74 billion, 20.3% of the total shared amount
  • Rivers state: N70.44 billion
  • Edo state: N14.51 billion
  • Ondo state: N9.47 billion
  • Imo state N8.16 billion
  • Abia state: N3.84 billion

Apart from Lagos and Ogun, other states in Nigeria depend heavily on federal allocation for revenue as their internally generated revenue is very abysmal.

In seven months, NNPC remits nothing to Federal Government

Recall reported that the Nigerian National Petroleum Company Limited (NNPC) has not remitted into the federation account for seven consecutive months as it battles huge subsidy payments.

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The company, which said it is adopting the Saudi Arabia-owned Aramco model, has deducted funds meant for the Federation Accounts Allocation Committee (FAAC) to cover petrol subsidy costs over time, resulting in zero revenue payments to the federal government.

According to the latest report by the company, N448,78 billion was deducted in July to cover subsidy costs.


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