FG Grants Four Oil Wells to Lagos, Revokes One

FG Grants Four Oil Wells to Lagos, Revokes One

The Federal Government on Wednesday agreed that four of the five oil wells discovered in Lagos actually belongs to the state, although it refutes the state’s ownership of one other oil well.

According to the Federal Government, the revoked oil well fell beyond 200 metres isobaths, hence did not legitimately belong to Lagos State, PM News writes.

This came after a delegation of the Indices and Disbursement Committee, Revenue Mobilisation, Allocation and Fiscal Commission, led by its Chairman, Alhaji Aliyu Mohammed, visited Governor Akinwunmi Ambode at the State House in Ikeja, Lagos, for the purpose of verifying crude oil and gas production in the state.

The Aje Oil wells, to be operated by Yinka Folawiyo Petroleum Company Limited, can now go into mining and refining activities with the purpose of disbursement of 13% derivation fund to the state in line with the constitution of Nigeria.

An Inter-Agency Technical Committee which comprised the RMAFC, the Department of Petroleum Resources, DPR, Office of the Surveyor General of the Federation and the National Boundary Commission was set up for the verification exercise, Mohamed disclosed.

“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,” he said.

“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 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 remark, Governor Ambode hailed the visit as a landmark moment in the state’s bid to become 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,” he said.

“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.

The governor called on other states to engage in such activities to so as to “create balanced growth and development for the whole country.”

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