Oil Revenue Derivation
Oil revenue allocation has been the subject of much contention well before Nigeria gained its independence. Allocations have varied from as much as 50%, owing to the First Republic's high degree of regional autonomy, and as low as 10% during the military dictatorships. This is the table below.
| Year | Federal | State* | Local | Special Projects | Derivation Formula** |
|---|---|---|---|---|---|
| 1958 | 40% | 60% | 0% | 0% | 50% |
| 1968 | 80% | 20% | 0% | 0% | 10% |
| 1977 | 75% | 22% | 3% | 0% | 10% |
| 1982 | 55% | 32.5% | 10% | 2.5% | 10% |
| 1989 | 50% | 24% | 15% | 11% | 10% |
| 1995 | 48.5% | 24% | 20% | 7.5% | 13% |
| 2001 | 48.5% | 24% | 20% | 7.5% | 13% |
* State allocations are based on 5 criteria: equality (equal shares per state), population, social development, land mass, and revenue generation.
**The derivation formula refers to the percentage of the revenue oil producing states retain from taxes on oil and other natural resources produced in the state. World Bank Report
Read more about this topic: Niger River Delta
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