Obasanjo, Diri Demand More Oil Revenue for Niger Delta

Former President Olusegun Obasanjo and Bayelsa State Governor Douye Diri have called for an increase in the 13 per cent derivation allocation to oil-producing states, arguing that the Niger Delta deserves a greater share of the benefits from its natural resources.

They spoke on Monday at the inauguration of the crude distillation unit of the $1 billion Azikel Refinery in Obunagha, Yenagoa Local Government Area of Bayelsa State.

Obasanjo described the existing 13 per cent derivation allocation as a starting point rather than a limit, encouraging oil-producing states and communities to continue pressing for a higher share.

“You are right that the states and oil-producing communities have not got a fair deal so far. Thirteen per cent is the beginning. You can continue to talk,” the former president said while addressing Diri.

He also praised the governor for supporting the refinery project and commended the use of funds accruing to Bayelsa, citing development projects across the state.

Diri, however, argued that the current revenue-sharing arrangement did not adequately reflect the challenges faced by communities where crude oil is extracted.

The governor criticised the Land Use Act, saying it created an imbalance by placing underground resources under federal control while surface resources belonged to states.

He maintained that the Niger Delta was not seeking to take all the benefits from oil production but wanted a greater role in decisions concerning resources extracted from the region.

“We do not want to take all to ourselves. We just want to be co-players in determining how it is done. Thirteen per cent is not enough for the states,” Diri said.

The governor said oil-producing communities had endured years of agitation over resource control and the distribution of benefits from petroleum production. He added that local participation in the industry was necessary to ensure residents benefit more directly from the resources beneath their land.

The event also highlighted the role of the Azikel Refinery in the region’s industrial development. Owned by Azikel Petroleum under the Azikel Group, the $1 billion project is designed to produce petrol, diesel and other petroleum products.

Azikel Group President Azibapu Eruani said the refinery was conceived to make the Niger Delta a more active participant in the oil industry and support industrialisation in Bayelsa and neighbouring states.

Obasanjo urged Eruani to complete the project within 12 months, while acknowledging the support of the African Finance Corporation and African Export-Import Bank.

The calls for increased derivation renew debate over resource control, environmental costs and the distribution of oil revenue in Nigeria.