A Review of the Nigerian Energy Industry

Nigeria: Oil producing states get N162bn in second quarter

23 October 2014, Lagos –THE Federal Government distributed N162.20 billion as 13 per cent Derivation Fund among the oil producing states during the second quarter of 2014.

Besides, the country exported 1.46 million barrels per day in the period under review.

Also, N106.65 billion was also distributed as Subsidy Re- Investment and Empowerment Programme (SURE-P) among the three tiers of government and the 13 per cent Derivation Fund as follows: Federal Government(N48.88 billion), State Governments (N24.79 billion), Local Governments (N19.11 billion) and 13 per cent Derivation Fund (N13.86 billion).

Central Bank of NigeriaAccording to the Central Bank of Nigeria (CBN) second quarter report, the sum of N7.62 billion, being the last installment of Nigerian National Petroleum Corporation (NNPC) refund to the sub-national governments, was paid and shared in April 2014 and 13 per cent Derivation Fund as follows: State Governments (N3.74 billion), Local Governments (N2.88 billion) and 13 per cent Derivation Fund (N0.99 billion).

Thus, the total allocation to the three tiers of government in the second quarter of 2014 amounted to N1,926.53 billion, compared with N1,827.74 billion and N2,095.20 billion in the preceding quarter and the proportionate quarterly budget estimate, respectively.

The apex bank disclosed that Nigeria’s crude oil production, including condensates and natural gas liquids, averaged 1.91 million barrel per day (mbd) or 173.81 million barrels (mb) in the review quarter, same level as in the preceding quarter. “It, however, fell by 1.0 per cent, compared with the evel in the corresponding period of 2013. Crude oil export was estimated at 1.46 mbd or (131.4 million barrels) in the review quarter, same as the estimated level in the preceding quarter.

It noted that despite the government efforts to curb incessant crude oil theft in the Niger Delta region, the menace has continued to dampen crude oil production. “Allocation of crude oil for domestic consumption was 0.45 mbd or 40.95 million barrels during the review quarter”.

CBN explained that at an estimated average of $112.23 per barrel, the price of Nigeria’s reference crude, the Bonny Light (37o API), rose by 1.7 per cent above the level in the first quarter of 2014. “The average prices of other competing crudes, namely the U.K Brent, the West Texas Intermediate and the Forcados also rose to $110.08, $98.74 and $113.07 per barrel, compared with $108.67, $96.10 and $111.44 per barrel, respectively, in the preceding quarter. At $105.74 per barrel, the average price of OPEC’s basket of eleven crude streams rose by 1.0 and 4.8 per cent, above the average of $104.73/b and $100.90/b recorded in the preceding quarter and the corresponding period of 2013, respectively”.

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