FG, states to share $4bn excess crude

Okey Muogbo, Abuja - 05.02.2008

THE National Economic Council (NEC) on Monday approved the sharing of $4.017 billion from the excess crude account between the federal and state governments.

This was one of the decisions of the council meeting chaired by the vice president, Dr. Goodluck Jonathan. The council comprises the state governors, minister of finance and chaired by the vice president.

Finance Minister, Dr. Shamsudeen Usman, who briefed journalists after the meeting jointly with the governors of Gombe, Lagos and Rivers states, said that the money would be shared 80 per cent for states and 20 per cent for Federal Government and would be released in three instalments begining from this month.

According to the minister, “the National Economic Council discussed three broad areas. One is the decision on the sharing of $4.017 billion of excess crude that has been agreed last year. You will recall that a committee was formed to advise on the modalities of sharing this.

“The second issue is the update on the indices used for the sharing of the 13 percent derivation among the oil producing state. There has been a little bit of controversy in this area.

“The third issue is that there was a presentation by the Minister of State, Power, on the power situation in the country. Prior to the President declaring a state of a emergency there was a need to take the governors into confidence in terms of the development.

“We agreed that the money be paid to the State Governors and the ratio has agreed before is 80 – 20. In a bid not to allow it affect the micro economy, we have also agreed that it will be essentially used for the purpose of construction. So it will be more on the side of capital projects and not recurrent.”