Fidelia Soriwei, Abuja
Former President Olusegun Obasanjo has called for an increase in the 13 per cent derivation fund allocated to oil-producing states, saying the current rate should serve as a starting point for further negotiations.
Obasanjo spoke on Monday at Obunagha in Yenagoa Local Government Area of Bayelsa State, where he inaugurated the Crude Distillation Unit (CDU) of the $1bn Azikel Refinery project.
The former president urged Azikel Group President, Dr Azibapu Eruani, to complete the refinery within the next 12 months, expressing confidence that the project could expand its capacity after completion.
“I have told Dr. Eruani that I will be officially 90 years by next year March. It means I will take the boarding pass soon. So, he has to make sure the project is completed before I exit,” Obasanjo said.
He also commended Governor Douye Diri for supporting the project and said Bayelsa had put its oil-derived revenue to productive use through development projects across the state.
“You are right that the states and oil producing communities have not got a fair deal so far. Thirteen per cent is the beginning. You can continue to talk. The most important thing is that even the little you have received, you have used it well,” he said.
The Azikel Refinery, owned by Azikel Petroleum under the Azikel Group, is expected to produce 2.5 million litres of fuel and two million litres of diesel daily, alongside other petroleum products. The project is intended to strengthen domestic refining and increase the Niger Delta’s participation in the petroleum industry.
Eruani described the inauguration of the CDU as a major step towards completing the refinery, recalling that Obasanjo laid its foundation eight years ago. He said the project would help drive industrialisation in Bayelsa and the wider Niger Delta by enabling the region to participate more actively in the oil and gas value chain.
The Azikel Group president also commended President Bola Tinubu for supporting indigenous refineries and acknowledged the contributions of the Bayelsa State Government, the African Finance Corporation and Afreximbank to the project.
Governor Diri said the refinery represented progress towards addressing the concerns of oil-producing communities, which have long argued that they receive insufficient benefits from the crude oil extracted from their land.
“As people of the Ijaw ethnic nationality, we have protested and fought because we feel that God gave us something in our land but we are not benefiting from it. Others are benefiting and saw us as second class citizens. It has been a long journey to be part of what God has given to us under our soil,” Diri said.
The governor criticised the Land Use Act and the existing derivation formula, arguing that oil-producing states deserved a greater share of revenue from their natural resources.
“The Land Use Act is unfair. Surface resources belong to states but what lies underneath belongs to the Federal Goverment. That law in obnoxious and not good for any just society.
“We do not want to take all to ourselves. We just want to be co-players in determining how it is done. Thirteen per cent is not enough for the states,” he added.
Diri urged Bayelsa residents, particularly young people, to acquire the skills needed to benefit from employment and business opportunities the refinery could create. He also called on oil companies operating in the Gbarain and Obunagha areas to rehabilitate the road leading to the facility.
The governor further stressed the importance of processing Africa’s natural resources locally rather than exporting them without sufficient domestic value addition.
In separate remarks, Azikel Petroleum board member, Dr Daru Owei, and the Ibenanaowei of Ekpetiama Kingdom and chairman of the Bayelsa State Council of Traditional Rulers, King Bubaraye Dakolo, commended Eruani, expressing confidence that the refinery would contribute to economic growth in Bayelsa, the Niger Delta and Nigeria.
