12 November 2012

Nigeria: Oil Wells - Seven States to Refund N17.5 Billion to Rivers

Abuja — As the controversy over the ownership of some wells between Rivers and Bayelsa States, continues unabated, seven states have been ordered by the Federal Government to refund N17.5 billion to Rivers State.

The amount, it was learnt, represents the sum they affected states, namely Akwa Ibom, Delta, Bayelsa, Imo, Edo, Abia and Ondo had received as part of their 13 percent derivation revenue from two oil wells, which the Rivers State Government had successfully proved belong to it.

The Federal Government ordered the refund to Rivers State, following a protest by the state that its revenue from the affected oil wells located in respect of Nda and Okwori oil fields with effect from 2007 had been shared to oil producing states by the Federal Government.

In response to the directive, Revenue Mobilisation Allocation and Fiscal Commission, RMAFC, wrote the Accountant General of the Federation, Mr. J.O Otunla on January 17, 2012, to effect the reduction of the money from the allocations of the seven states with immediate effect.

The letter reads: "I write to inform you that the Rivers State Government in a letter Ref. No. COM/FIN/T/01 of October 3, 2011 requested for the payment of all the 13 per cent derivation revenue due to the state from Nda and Okwori oil fields from 2007 till date.

"The commission examined the request and confirmed that Okwori and Nda oil fields belong to Rivers State based on the report of the Inter-Agency Committee on the attribution of offshore oilfields to Littoral states, 2008 and submissions by National Boundary Commission, NBC and Office of the Surveyor-General of the Federation, OSGF.

"Furthermore, the 13 per cent derivation proceed from the two oil fields were shared amongst all the oil producing states from April 2009 to June 2010, while Akwa Ibom State exclusively enjoyed the proceed from Okwori oil field from July to August, 2010 and from July 2010 to January 2011 in the case of Nda oil field.

"It is to be noted that the Rivers State Government had since September 2010 and February 2011 been receiving its due share of 13 per cent derivation proceed from Okwori and Nda fields respectively.

"Consequently, the commission after considering the request from the Rivers State Government and the submission from both the NBC and OSGF, approved that Rivers State should be refunded the sum of N17.566bn by all the oil producing states being accrued 13 per cent derivation fund from April 2009 to January 2011.

"The amount to be refunded by each state is as follows: Abia, N226.25million; Akwa Ibom, N9. 567bn; Bayelsa, N2.071bn; Delta, N4.142bn; Edo, N305.69million; Imo, N260.73million; Ondo, N952.54million."

The letter was by Chairman of RMAFC, Eng. Elias Mbam.

On the strength of the letter, a group in Rivers State, known as Rivers Truth Option, has asked the governor of the state to address the people of the state on the true position of the oil wells and revenue accruing from same.

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