Nigeria’s key oil producing states received a total of N327.79 billion as 13 per cent derivation revenue payments from the Federation Account in the first three months of this year, findings by New Telegraph show. The amount is 16.79 per cent, or N66.14 billion, less than the N393.93 billion shared by the states in the corresponding period of 2025.
An analysis of Federation Account Allocation Committee (FAAC) disbursement reports for January – March 2026, indicates that the oil producing states received N96.08 billion, N110.95 billion and N120.76 billion as thirteen per cent derivation revenue payments for January, February and March 2026 respectively.
In addition to their statutory allocations, the country’s major oil producing states, such as, Rivers, Delta, Bayelsa, Abia, Akwa Ibom, Imo, Edo, Ondo and Anambra, also receive 13 per cent of oil revenue from the Federation Account as Derivation Fund, to enable them cushion the impact of exploration and support development.
Further analysis of communiqués issued by the FAAC shows that the decline in the total amount received by the nine states as 13 per cent derivation revenue payments in the first quarter of 2026 compared with the corresponding period of last year, reflected the challenges that the country faced with oil production in the first three months of this year.
For instance, although latest data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) shows that crude oil production (excluding condensate) increased by 5.2 per cent to 1.382 mbpd in March 2026 from 1.313 mbpd in February, the country fell short of its Organisation of the Petroleum Exporting Countries (OPEC) quota of 1.5 mbpd for the third consecutive month. Also, output remained below the 1.84 mbpd benchmark set in the 2026 budget.
Industry experts attribute the reduced output in oil production in Q1’2026 mainly to the temporary shutdown for maintenance of the Bonga oil field (Feb 1–March 18), a development that caused Nigeria to miss out on high global oil prices, which averaged around $100 per barrel during this period.
Interestingly, while what the oil producing states received as 13 per cent derivation revenue payments from the Federation Account in the first three months of this year, was lower than what they got in the corresponding period of 2025, the sub-nationals got paid a total of N1.60 trillion as 13 per cent derivation revenue payments in 2025, which is 13.82 per cent, or N193.88 billion, higher than the N1.40 trillion that they shared in the preceding year.
Indeed, analysts note that compared with 2022 and 2023, the country’s major oil producing states, along with their non-oil producing counterparts, generally benefitted from higher FAAC allocations in the last two years, as a result of exchange rate gains in the oil sector and increased oil production, occasioned by reforms introduced by the President Bola Tinubuled administration when it came into office on May 29, 2023.
