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Niger Delta deserves 100% oil revenue —Falae

A former Secretary to the Government of the Federation and delegate to the National Conference, Chief Oluyemisi Falae, has thrown his weight behind the Niger Delta region, saying it deserves 100 per cent control of its resources.

Speaking to SUNDAY PUNCH, Falae urged other states of the Federation to approach the issue of resource control and derivation with the recognition that oil-producing states had full ownership of their resources.

He said, “We should recognise that the oil belongs to them. We cannot begin to threaten or abuse them for not sharing a direct proportion with us.

“We all agreed ultimately that the owners of the resource should take 100 per cent of the profit. However, they should allow other areas and states to develop their resources and sources of revenue before they (Niger Delta) have all the profits to themselves. That is why we have the solid minerals development fund to assist their natural resources. Fortunately, every state in Nigeria has several solid minerals that are already waiting for exploitation and development.”

Falae argued that the owners of lands where oil is being explored and produced deserve to take all the profits as a result of oil companies’ operations on their land.

He said, “What are they fighting for? Resource control is much larger than derivation. Resource control is what it says it is — control over natural resources. That’s not derivation. But in our discourse it’s being reduced to derivation.

“Before any exploration, owners of the resource should be involved for authorisation. Therefore, the approval process should include people from the Niger Delta, the Federal Government agencies that authorise foreign oil companies to look for oil and produce. We have identified that process at the national conference.”

Falae, however, pleaded with the oil-producing states to give other states some time to develop before they lay full claim to their resource.

“Really, no one knows when exactly other states will stop feeding on the oil money coming from the Niger Delta. It should be recalled that before now, the country used to produce coal in Enugu. We were even exporting coal at that time. Within a year or two, the coal mine can start generating revenue.

“Delegates to the confab had recommended that the Ajaokuta steel mine construction should be completed. Very soon, there’ll be mining of iron ore and between one and three years, we can begin to generate revenue,” Falae stated.

He said at the moment, states with petroleum resources cannot determine what percentage they want from the derivation fund. According to him, the whole country currently depends on oil revenue and any effort to lay claim to 100 per cent control of the oil revenue will cause problem.

He added, “In view of this, in the next five or ten years, these other states would have developed alternative sources of revenue and in time, the oil-producing states can have total control of profits accruing from their resources. Similarly, other states with other revenue-generating mineral resources will have 100 per cent of the profits coming from their areas.

“In the next three or four years, I believe some states will begin to generate their own revenue from a number of resources. In another 10 years, most states should be comfortable if they are serious in exploiting the natural resources in their areas.”

He explained that what was causing furore at the confab was the issue of derivation.

Falae said, “The contention of the non-oil producing states — especially the northern states — is that if the derivation percentage for the oil-producing areas is much higher than 13 per cent, what will be left for sharing among other states of the Federation will be very small that many state governments will not be able to pay salaries to their staff and run their administrations.


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Posted by on Jul 19 2014. Filed under Headlines, Niger Delta. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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