Lagos joins the big league, to get derivation fund from Dec

The foremost position of Lagos State in the comity of states in the country is set to be further enhanced as it is to join the league of oil producing states that enjoy the 13 per cent derivation fund from the Federation Account.

This was disclosed by the State Governor, Akinwunmi Ambode on Tuesday, when he announced that the state will start receiving the derivation fund from December with the conclusion of the first export of crude oil from the Aje oil field located offshore Lagos and operated by an indigenous company, Yinka Folawiyo Petroleum Company Limited.

He stated this at the 2016 edition of the annual international conference and exhibition of the Nigerian Association of Petroleum Explorationists.

It would be recalled that Yinka Folawiyo Petroleum Company Limited, operators of the OML 113, announced that it had commenced the production of crude oil from the Aje field on May 3.

However, the payment of derivation, according, the Chairman, Indices and Disbursement Committee, Revenue Mobilisation Allocation and Fiscal Commission, Alhaji Aliyu Mohammed, would not start until exportation of crude begins from the oil field.

Ambode, who was represented by his Commissioner for Energy, Wale Olowu, said: “I am pleased to announce that the first export from the Aje oil field has happened. That is not the big deal; the big deal is that Lagos State is anxiously awaiting its first derivation in December. So, in December, we will be collecting our first derivation.

“We cannot wait to see a lot of oil and gas come under the soil of Lagos, because it will help us in the area of employment; it will help us in the area of electricity generation, which we want to do off-grid anyway; and it will also help us in making sure that our revenue continues to be diversified.”

The governor stated that his administration would continue to work hard to make the state the investment hub for oil and gas in the country.

He also said the state government was monitoring and is ready to massively support other Oil Prospecting Licences in Lagos to make sure they can quickly transform to Oil Mining Leases.”