A Review of the Nigerian Energy Industry

C/River demands N15.5bn from FG, A/Ibom over disputed oil wells

01 April 2012, Sweetcrude, ABUJA – Cross River State is demanding a N15.5 billion compensation from the Federal and Akwa Ibom State governments over the 76 oil wells that originally belonged to it, which was transferred to Akwa Ibom State by the Revenue Mobilisation, Allocation and Fiscal Commission.

The demand is contained in an originating summons at the Supreme Court filed on behalf of the Cross Rivers State government by its counsel, Yusuf Ali.

The state, in the summons, is asking the court to compel the Federal and Akwa Ibom State governments to pay it the N15.5 billion, representing the 13 per cent derivation that ought to have accrued to the state on the wells from November 2009 to March 10, 2010.

According to the summons, the N15.5 billion is made up of N9.2 billion for the state government and N6.3 billion for the local government councils of the state that are hosts to the oil wells.

The state is also demading, in the summons, that the Supreme Court issue an order of perpetual injunction restraining the federal government from excluding it from its entitlement to 13 per cent derivation in the sharing of revenue from the Federation Accounts as a littoral state, based on the 76 oil wells which it claimed had earlier been attributed to it.

The state argued that following a boundary dispute between it and Akwa Ibom State, the then president, Olusegun Obasanjo, had summoned the two states and had amicably resolved the dispute for the two states.

It argued that upon a demarcation of the boundary following the dispute between the two states, 90 oil wells were found to be in the territory of Cross River State.

“By negotiation, however, for the sake of peace, 14 of these oil wells in the territory of Cross River State were attributed to Akwa Ibom State for the purpose of application of derivation,” the state government said.

It further argued: “Akwa Ibom State received and still receives revenue on derivation for the 14 oil wells which are physically in the territory of Cross River State but which are attributed to Akwa Ibom.

“This benefit is sequel to the boundary settlement between the two states which Akwa Ibom now seeks to rescind or renege on.”

But, Akwa Ibom State government, in its response, stated that by virtue of the judgement of the International Court of Justice ceding the Bakassi Peninsula to Cameroun, Cross State became landlocked and no part of its territory lay or lies contiguous to the sea.

It held, in its reply filed by its counsel, Chief Bayo Ojo and Paul Usoro, that Cross River had qualified as a littoral state because it had access to the sea through Bakassi Peninsula and the estuarine part of the body of water (inland waters) called Cross River.

According to the state, Bakassi Peninsula lies contiguous to the sea while the Cross River estuary empties into the sea.

The fact of Bakassi Peninsula and the Cross River estuary being part of Cross River State was the sole qualification and basis for Cross River State being adjudged a littoral state prior to the ICJ judgement.

It further said: “The ICJ judgement excised the entirety of the Bakassi Peninsula from Nigeria and gave it to Cameroun as admitted by the plaintiff.

“Also wiped out by the ICJ judgement and excised from Cross River State along with the Bakassi Peninsula was the aforementioned estuarine part of the Cross River; Cross River State ceased thenceforth to be a Nigerian littoral state.”

In a statement of defence filed on behalf of the federal government by Mr. Damien Dodo, the federal government opposed the claims by the Cross River State Government, saying Cross River was not entitled to the claims. It raised the same defence canvassed by Akwa Ibom while asking the Supreme Court to dismiss the suit.

The case comes up for hearing on May 8.

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  • Crossriverians said akwa ibom and them are not one. And i ask,”where do the efiks come from? Is it not uruan? What did they do, they started by sacking all akwaibomite from there ministeries, stop our children from gaining admission. We are not heartless, if they will accept we are their elders then…