Former President Olusegun Obasanjo has called for an increase in the 13 per cent derivation allocated to oil-producing states, saying the current share is insufficient.
He spoke on Monday at the inauguration of the Crude Distillation Unit (CDU) of Azikel Refinery in Obunagha, Yenagoa Local Government Area of Bayelsa.
Obasanjo commended Azikel Group President, Azibapu Eruani, for initiating the one-billion-dollar refinery project and urged him to complete it within 12 months. The refinery is expected to produce 2.5 million litres of petrol and two million litres of diesel daily, alongside other petroleum products.
He also praised Bayelsa Governor Douye Diri for supporting the project and using the state’s revenue for development.
Addressing the issue of derivation, Obasanjo said 13 per cent was only the beginning, adding that oil-producing states and communities deserved a fairer deal.
Eruani said the refinery would drive industrialisation in Bayelsa and the wider Niger Delta. He recalled that Obasanjo laid its foundation eight years ago and described the installation of the CDU as a major step towards completing the project.
He also commended President Bola Tinubu, Diri, the African Finance Corporation and Afreximbank for supporting indigenous refining.
Diri said the refinery represented progress in the Niger Delta’s struggle for greater participation in the petroleum industry. He criticised the Land Use Act and the existing derivation formula, insisting that oil-producing states deserved a greater share of their natural resources.
“The Land Use Act is unfair. Surface resources belong to states, but what lies underneath belongs to the Federal Government.
“That law is obnoxious and not good for any just society,” he said.
Diri stressed that the region wanted to participate meaningfully in decisions concerning its resources, declaring that 13 per cent was insufficient.
He urged residents to acquire the skills needed to benefit from opportunities the refinery would create and called on oil companies operating in the Gbarain/Obunagha area to help rehabilitate the road leading to the facility.
