Nigeria’s oil-producing states, including Rivers, which has been engulfed by a political crisis in recent months, leading to President Bola Tinubu declaring emergency rule in the state, last Tuesday, earned a total of N261.32 billion as 13 per cent derivation revenue payments from the Federation account in the first two months of 2025, compared with N251.35 billion in the corresponding period of last year, findings by New Telegraph show.
An analysis of the communiqués issued by the Federation Account Allocation Committee (FAAC) at the end of its meetings for the months of January and February 2025, indicates that the oil-producing states earned N1.25 billion and N136.04 billion as 13 per cent derivation revenue payments in January and February respectively.
This means that the states earned a total of N261.32 billion as 13 per cent derivation revenue payments from the Federation account in the first two months of this year, which is 3.97 per cent, or N9.98 billion higher than the N251.35 billion that they earned in the same period last year.
Apart from Rivers, the country’s oil-producing states such as, Abia, Akwa Ibom, Anambra, Bayelsa, Delta, Imo, Edo and Ondo, are statutorily required to be paid, in addition to their usual allocation, 13 per cent of oil revenue from the Federation Account as Derivation Fund, which they are expected to use for the exclusive benefit of their oil/ gas producing communities whose environments are typically negatively impacted by mineral exploration and production activities.
Thus, the statement released by the Director, Information and Public Relations at the Federal Ministry of Finance, Mohammed Manga, over the weekend, on the outcome of the FAAC meeting for March 2025, said that the committee shared a total sum of N1.678 trillion to the three tiers of government as Federation Allocation for the month of February 2025 from a gross total of N2.344 trillion.
The statement further said: “From the stated amount inclusive of Gross Statutory Revenue, Value Added Tax (VAT), Electronic Money Transfer Levy (EMTL), an argumentation of N178 billion and revenues from Solid Minerals, the Federal Government received N569.656 billion, the States received N562.195 billion, the Local Government Councils got N410.559 billion, while the Oil Producing States received N136.042 billion as Derivation, (13% of Mineral Revenue).
“The sum of N89.092 billion was given for the cost of collection, while N755.097 billion was allocated for Transfers Intervention and Refunds.” New Telegraph reports that compared with 2022 and 2023, the country’s 36 states generally benefitted from higher FAAC allocations last year, especially from exchange rate gains in the oil sector and increased oil production, occasioned by reforms introduced by the President Bola Tinubu-led administration when it came into office on May 29, 2023.
Indeed, an analysis of FAAC communiqués and data released by the National Bureau of Statistics (NBS), last year, indicates that 13 per cent derivation revenue payments to the oil producing states, from the Federation account, surged by 102.26 per cent (N679.26 billion) to N1.34 trillion last year, compared with N664.22 billion in the preceding year.
Although available data shows that in February 2025, Nigeria’s domestic crude oil production, including condensates, stood at 1.67 million barrels per day (mbpd), falling short of both the January 2025 output of 1.74 mbpd and the Federal Government’s 2025 budget target of 2.06 mbpd, analysts note that the country had, in January, for the first time, met the Organisation of Petroleum Exporting Countries’ (OPEC) production quota of 1.5 million bpd since it was set — for the 2024 period — at the global oil cartel’s ministerial meeting on November 30, 2023.
