In the first half of 2024, Nigeria’s nine oil-producing states received N341.59 billion from the federation account based on the 13 percent derivation formula. Delta State led with N113.78 billion, but issues of debt and mismanagement persist despite these substantial allocations.
In the first half of 2024, Nigeria's nine oil-producing states collectively received N341.59 billion from the federation account through the 13 percent derivation formula. This allocation is based on Section 162 (2) of the Nigerian Constitution, which mandates that 13 percent of revenue from natural resources like oil and gas be directly distributed to the states where these resources are extracted.
Delta State received the largest share of N113.78 billion, accounting for 33 percent of the total funds. Akwa Ibom followed with N70.01 billion, while Bayelsa and Rivers received N64.04 billion and N58.78 billion respectively. Edo, Ondo, Imo, Anambra, and Abia received smaller portions, with Abia receiving the least at N3.19 billion.
Despite these significant allocations, many of these states continue to grapple with substantial debt and deteriorating infrastructure. Edo State leads in debt with N490.67 billion, followed by Delta and Rivers with N413.75 billion and N340.25 billion respectively.
Concerns about the utilization of these funds have been voiced by prominent figures such as Edwin Clark, who criticized the mismanagement of derivation funds in Delta State under the previous governor, Ifeanyi Okowa. Clark accused the administration of diverting funds from crucial projects to less critical areas, highlighting ongoing issues of transparency and accountability.
As these states receive substantial financial support, the challenge remains to effectively manage these resources to address debt and improve infrastructure.
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