FG moves to ensure equitable 13% derivation fund distribution, re-verifies oil wells

The Federal Government has initiated a re-verification process for disputed and newly discovered oil and gas wells to ensure equitable distribution of the 13% derivation fund among oil-producing states, according to a recent press release by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC). The Inter-Agency Technical Committee (IATC), a reconstituted body, was inaugurated to carry out this exercise, which is expected to run from 2017 to the present.

The primary objective is to enhance fiscal transparency, equitable revenue allocation, and institutional integrity in Nigeria. The verification process aims to address concerns regarding the coordinates, boundaries, and mapping of oil and gas wells. Dr. Mohammed Bello Shehu, RMAFC Chairman, highlighted that this verification would provide a solid technical basis for determining which oil and gas wells qualify for consideration in the derivation revenue allocation process.

To optimize efficiency and accountability, a two-tier governance structure has been established, separating technical verification and field activities from strategic oversight and final approval. The RMAFC will offer the committee institutional support, including coordination with relevant security authorities to facilitate administrative clearances, tactical assistance, and security during field operations in challenging environments.

In August 2026, Nairametrics reported that 11 oil-producing states collectively received N321.90 billion under Nigeria’s 13% derivation formula in the first quarter of the year. The report, based on data from BudgIT Nigeria, revealed that six states in the Niger Delta received nearly 90% of the total allocation. The latest re-verification exercise focuses on establishing precise technical records of disputed and newly discovered oil and gas wells, which will contribute to the determination of derivation allocations.