Obasanjo Advocates for Increased Derivation Rates for Oil-Producing States

Former President Olusegun Obasanjo has made a compelling case for an increase in the 13 percent derivation allocated to oil-producing states, highlighting the critical need for enhanced financial support to these regions. Speaking at the inauguration of the Crude Distillation Unit (CDU) of the Azikel Refinery in Obunagha, Bayelsa State, Obasanjo underscored the importance of oil revenue in fostering local development and empowering communities.

The one-billion-dollar refinery project, owned by Azikel Petroleum, is anticipated to significantly contribute to Nigeria's economy by producing 2.5 million liters of petrol and two million liters of diesel daily, along with other petroleum products. During the event, Obasanjo commended Dr. Azibapu Eruani, the President of Azikel Group, for spearheading the initiative and urged him to ensure its completion within a year. He expressed a sense of urgency, stating, "I have told Dr. Eruani that I will be officially 90 years by next March. It means I will take the boarding pass soon. He has to make sure the project is completed before I exit."

Obasanjo's remarks were not only a call for increased derivation but also a recognition of the positive impact that the refinery could have on the local economy. He praised the state government, led by Governor Douye Diri, for its commitment to utilizing state revenues effectively, which has resulted in numerous developmental projects in Bayelsa. The former president emphasized that continued support is essential to ensure the refinery's successful operation and completion.

Addressing the audience, Obasanjo also acknowledged the contributions of the African Finance Corporation (AFC) and Afreximbank in backing the project. He noted the significant progress made since his last visit, reinforcing the notion that such investments are pivotal for sustainable regional development. The call for an increase in the derivation rate highlights ongoing discussions about resource allocation and fiscal policies that impact Nigeria's oil-producing states.