76 oil wells: Cross River lost N7bn in 20 months

In July 2012, the apex court, in a unanimous judgment, dismissed Cross River’s claim to the oil wells and ceded them to Akwa Ibom.Immediately after the verdict, the state lost its 13 percent derivation share as an oil producing state.An analysis of the Federal Ministry of Finance official documents shows that the last derivation share […]

In July 2012, the apex court, in a unanimous judgment, dismissed Cross River’s claim to the oil wells and ceded them to Akwa Ibom.
Immediately after the verdict, the state lost its 13 percent derivation share as an oil producing state.
An analysis of the Federal Ministry of Finance official documents shows that the last derivation share received by Cross River was for June 2012 which was shared in July by the Federation Accounts Allocation Committee (FAAC).
The state received N345 million as its derivation share for the month of June 2012, shared in July just some days before the judgment.
Before the judgment, Cross River collected between N345 to N400 million as its derivation share every month.
With the exit of Cross River, the number of oil producing states has been scaled down to eight, namely: Akwa Ibom, Rivers, Delta, Bayelsa, Edo, Ondo, Abia and Imo.
In a lead judgment by Justice Olufunlola Adekeye, the apex court held that Cross River could no longer lay claim to the disputed oil wells because it had ceased to be a littoral state following the ceding of Bakassi peninsula to Cameroon by the federal government.
The court held that with the execution of the judgment of the International Court of Justice (ICJ), especially the ceding of Bakassi to Cameroon, Cross River can no longer lay claim to any oil well in the high seas since its boundary with the sea had gone with Bakassi.
It said that “a non- littoral state cannot claim oil wells offshore as she has no maritime territory”.
The court also held that the “13 percent derivation on the 76 oil wells offshore between Akwa Ibom State and Cross River State must continue to be attributed to the state on whose maritime territory they are found to be located by the relevant government agencies; that is the National Boundary Commission, the Revenue Mobilization, Allocation and Fiscal Commission relating with the office of the Surveyor-General of the Federation and the Accountant-General of the Federation.”
By this, the Cross River derivation share would be channeled to Akwa Ibom, which is already the leading beneficiary of the derivation formula.
According to FAAC documents, Akwa Ibom got N12.3 billion as its derivation share for the month of June, 2012.
But after receiving the hitherto Cross River’s share of July, Akwa Ibom’s derivation money increased to N13.3 billion.
The eight oil producing states shared N48 billion in December, 2013 as derivation funds, with Akwa Ibom receiving (N15 billion); Delta (N10 billion); Rivers (N9 billion); Bayelsa (N9 billion); Ondo (N1.9 billion); Edo (N1.4 billion); Abia (N473 million) and Ondo (N469 million).
Having stopped receiving its monthly derivation share of between N345 to N400 million, Cross River has since joined the league of non-oil producing states like Ebonyi, Yobe, Zamfara, Taraba, among others.  
In December 2013, FAAC records show that the state went home with only N3.5 billion  as its total share from the federation.