Lagos State has officially joined the list of oil producing states in the country, as the federal government has said that four of the five oil wells discovered in Badagry legitimately belong to Lagos State.
For this, the federal government said Lagos state would be entitled to 13 per cent derivation from the Federation Account.
Government stated that the fifth well, Aje 3, falls beyond the 200-mile isobaths and therefore cannot be legitimately attributed to the state.
This was disclosed by the Chairman of the Indices and Disbursement Committee, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Alhaji Aliyu Mohammed, during a working visit to the state governor, Mr. Akinwunmi Ambode, at the State House, Alausa, on Wednesday.
Mohammed said the technical committee recommended that “for the purpose of derivation as spelt out under Section 162 (2) of the constitution, as well as the Allocation of Revenue (Abolition of Dichotomy in the Application of Derivation), Act, Aje oil wells 1, 2, 4 and 5 fall within the 200-mile isobaths and therefore should be attributed to Lagos State”.
He added that the commencement of oil production from the Aje oil field by Yinka Folawiyo Petroleum Company Limited was the first time oil is being produced outside the Niger Delta basin and therefore of major significance in diversifying the source of crude oil and gas production in the country.
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