The Federal Government on Wednesday approved four of the five oil wells discovered in Lagos as truly belonging to the state, but disproves the state’s ownership of one other oil well, which it said fell beyond 200 metres isobaths and did not legitimately belong to Lagos state.
A delegation of the Indices and Disbursement Committee of the Revenue Mobilisation Allocation and Fiscal Commission, RMAFC, led by its Chairman, Alhaji Aliyu Mohammed stated this during a visit to the state governor, Akinwunmi Ambode, for the purpose of verifying crude oil and gas production from Aje Oil wells for the purpose of disbursement of 13 per cent derivation fund to the state in line with the Constitution.
Mohammed explained that as part of procedure and in pursuant to its constitutional mandate, the commission set up an Inter-Agency Technical Committee which comprised the commission, the Department of Petroleum Resources, DPR, Office of the Surveyor General of the Federation and the National Boundary Commission to determine the location of the Aje oil wells. According to him, “The technical committee recommended that for the purpose of derivation as spelt out under Section 162 (2) of the 1999 constitution (as amended) as well as the provision of the Allocation of Revenue Act 2004, Aje oil wells 1, 2, 4 and 5 fall within the 200m isobaths and therefore should be attributed to Lagos State.
“As a result, the commission and members of the Inter-Agency Committee had to embark on this working visit to conclude the process. Please, note that Aje 3 oil well falls beyond the 200m isobaths and therefore cannot be legitimately attributed to Lagos State,” he stated.
The Committee Chairman added that the commencement of oil production from Aje oil field by Yinka Folawiyo Petroleum Company Limited was the first time oil was being produced outside the Niger Delta basin and therefore of a major significance in diversifying the source of crude oil and gas production in the country.
In his remarks, Ambode described the visit as historic and one that would go down in the annals of the history of Lagos State, as the visit was the official step that would take Lagos to that final destination as an oil-producing state.“We are very glad to receive this delegation. We also want to thank the Federal Government, most especially President Muhammadu Buhari for making this to happen very promptly. I want to say that this has been the promptest action that has been taken by RMAFC since I have known the Commission.
“I used to be a former Account General so I had a lot of transactions and relationship with the institution called RMAFC. Within a span of about 60 days of when we wrote our letter, and even before we wrote the letter, this technical committee was actually set up. It gladdens me to say that the institution works and is working for the good of Nigeria,” he said.
While commending the DPR and the boundary commission, Ambode said it was significant that the discovery of oil wells in Lagos was going to be the first time oil would be produced outside the Niger Delta.
His words, “It’s significant for Nigeria, its significant for Lagos, it means that the whole path to diversification is what we are now witnessing. We would also encourage other states in terms of other mineral resources, not necessarily depend on crude oil; whatever it is that can actually allow states to start activating their mineral deposits, it would allow us expand the Internally Generated Revenue.
“It would also give us revenue dependence in a manner that there would be equal growth from all the nooks and crannies of Nigeria. One is happy that RMAFC has taken this step and also to say that they should also encourage other states to engage in such activities that would allow them to be able to activate whatever mineral deposit that we have in the various states in conjunction with the Federal Government, so that we can start to diversify revenue and growth and then create a balanced growth and development for the whole country.”