It has been revealed that crude oil-producing states located in the south-south region of Nigeria earned N9.53 trillion as their share of oil revenue between 2000 and 2018 following a fresh report by the Nigerian Extractive Industries Transparency Initiative, NEITI.
Four of the states are said to be among the top indebted states in the country despite these revenues.
The states according to NEITI’s recent ‘Occasional Paper’ which examined the perception of communities on the 13 per cent oil derivation income to them included Akwa Ibom, Bayelsa, Delta, Edo and Rivers.
On the other hand, Cross River which has ceased to be an oil-bearing state was amongst the states in the region that partook of the N9.53 trillion over the 18-year period.
According to the NEITI research, Akwa Ibom, Bayelsa, Delta and Rivers states received N1.60 trillion, N1.20 trillion, N1.38 trillion and N1.54 trillion, respectively from 2001 to 2018 and are classified as the top four subnational oil producers and revenue earners in Nigeria.
Despite earning so much, the NEITI report noted that four of the states are also among the highest indebted states in the country.
It explained that: “As at September 2019, Debt Management Office (DMO) puts Akwa Ibom’s debt profile at N237.4 billion, Bayelsa at N127.2 billion, Delta at N230.57 billion and Rivers at N266.9 billion,” adding that figures showed that the 13 per cent oil derivation fund allocated to Niger Delta states from 2000-2018, and the debt profile of all subnational governments and the Federal Capital Territory reveal the antinomy of the affluence and the affliction of oil wealth in the region.
The report stated that community folks in the states were unsatisfied with the application of oil revenue by their governments, adding that, “it is obvious that aside Ondo, Abia and Edo (in that order), the debt profile of all the oil-producing states in the Niger Delta hovers in 12 digits.”
“Ondo State’s debt overhang as of September 2019 stood at N56.4 billion, despite earning N272.88 billion as 13 per cent oil derivation revenue from 2001-2018. Within the same period, Imo State earned a total of N623.1 billion – with N83.29 billion as 13 per cent derivation fund; however, the state owes N148.9 billion; while Edo State earned N114.3 billion during the 18 years, but presented a debt profile of N83.1 as at September 2019,” it further said.
The NEITI stated that this reality, added to the deepening social and environmental consequences of extraction, “has turned the Niger Delta into an epicenter of unmatched contradictions.”
“On the one hand, the region is home to highest subnational revenue earners from the Federation Accounts, while on the other hand, it shows very limited impacts in terms of the real value realised from the huge revenue allocation and disbursement to its component states.
“Worse still is that despite being the epicenter of several development policy initiatives tailored to respond to the ecological needs and the negative consequences of oil extraction, the development outcomes from those initiatives have met only minimal expectations,” it added.
The report listed the various government-led developmental interventions initiated for the Niger Delta with minimal impacts to include the Niger Delta Development Board, the Niger Delta Basin Development Authority, the Presidential Committee on 1.5 per cent Derivation Fund, the Oil Mineral Producing Areas Development Commission, the Niger Delta Development Commission and the Ministry of Niger Delta.
“The interventions in the Niger Delta are yet to reverse or significantly improve the conditions of poverty and underdevelopment of citizens of the region. Put differently, the higher revenue disbursement to Niger Delta states from the Federation Accounts Allocation Committee (FAAC) on account of 13 per cent oil derivation have raised citizens’ expectations without a corresponding delivery of performance,” it explained.
According to the NEITI, even in the face of the financial crisis from a crash in oil prices in 2014, states in the region still requested for bailouts from the federal government.
“At the height of the financial crisis that commenced with the mid-2014 fall in global oil prices, seven out of the nine oil states of the Niger Delta joined 20 others to apply and draw from the federal government’s N338 billion stimulus package, otherwise known as “bailout “, to pay salaries.
“The seven states which benefited from the nine per cent interest repayable loan were: Abia (N14.152 billion), Bayelsa (N1.28 billion), Cross River (N7.856 billion), Delta (N10,036 billion), Edo (N3.167 billion), Imo (N26.806 billion), and Ondo (N14.686),” it added