The rampaging COVID-19 crisis is currently stoking a fresh oil revenue trouble in the Niger Delta, Nigeria’s main oil and gas region.
Nigeria is no longer able to meet the targeted demand of crude oil benchmark of $57 per barrel to fund the ailing 2020 budget as the fall in crude price has made it to reduce the benchmark to $30, a gap of $27, which is a deficit, aside from slashing N1.5 trillion in order to make the budget realistic.
The country’s economy has been facing collapse since it largely depends on oil exports. Oil markets have not been predictable as COVID-19 has been crippling demand. Fuel prices fell and recorded 18-year low trading at less than $22 per barrel and expected to be fluctuating.
In a seeming desperate bid to salvage the situation and enable ease of business in Nigeria despite the pandemic, Central Bank of Nigeria (CBN) Governor, Godwin Emefiele, at the ‘Growth 2.0 Meeting’ held in Abuja on March 15, and at the ‘Banker’s Committee Meeting’ on March 20, in Lagos, announced policy measures such as the additional moratorium of one year on CBN intervention facilities.
Other measures include, interest rate reduction on intervention facilities from 9% to 5%; the activation of the N1.5 trillion InfraCo Project for building critical infrastructure; the strengthening of lending to deposit ratio policy, additional N100 billion intervention in healthcare loans to pharmaceutical companies; and the N1 trillion loan to boost local manufacturing and production across critical sectors.
It seems, the shortfall in derivation fund to the oil states is throwing up fresh unease in the oil and gas region. Some of the concerned leaders are already planning to cripple the Federal Government access to oil revenue.
Former National Publicity Secretary of the Peoples Democratic Party (PDP), Senator Anietie Okon, says they will explore legal options to stop oil majors operating in the Niger Delta from remitting monies to Abuja.
This is because the Buhari administration has been withholding the 13% derivation fund from the oil states for four months now. The worse hit appears to be Akwa Ibom State.
Akwa Ibom Leaders Vanguard is mobilizing the active social formations in the oil region to renew their agitation for an upward review of the derivation fund to 50%. They are also demanding the immediate release of all arrears of derivation funds accruing to the nine oil states: Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo, and Rivers.
”For more than four months, the 13% derivation has been withheld by the Federal Government, the reason for this abnormality is said to be the dwindling economy due to the coronavirus pandemic’’, Okon says.
According to him, some concerned leaders are considering to file a suit in court against the Buhari administration for its refusal to pay to Akwa Ibom the 13% oil derivation fund for four months, pointing out that the non-payment of the 13% has stalled major developmental projects of the state government.
While saying the action by the Buhari administration was inimical to the interests of Akwa Ibom, he adds, ‘’Akwa Ibom Leaders’ Vanguard views this as a total disregard to the provisions of the Nigerian Constitution of the Federal Republic of Nigeria; a gross insensitivity and disregard for the people of oil producing states of Nigeria.
‘’It is regarded as an affront on the good people of the Niger Delta region. Akwa Ibom Leaders’ Vanguard ponders on the ease with which the Presidency and the APC-led Federal Government pours scorn on the people of the Niger Delta, the goose that lays the golden eggs for all to eat.
“They are taking the relative peace in the zone maintained by the peace loving elders of the zone for granted and are dancing on the keg of gun powder.”
For him, the position of the elders was that the country should be restructured as the people of the South-South could no longer shoulder the burden of having its resources drained without commensurate benefits.
Meanwhile, Akwa Ibom Information and Strategy Commissioner, Ini Ememobong, says there had been variations on the payment of the fund: “There are outstanding derivation variations which have been assessed but not paid.”
Though he did not give details, officials of the Udom Emmanuel administration have been attributing the non completion of many road projects to the withholding of the derivation fund
