Nigeria’s Oil Revenue Climbs 22% to N824bn In July

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Published on Thursday, 16 August 2012 22:40

Written by Elombah.com

The federal government revenue rose 8 percent to 825.4 billion naira ($5.3 billion) in July compared with 763.6 billion naira in the previous month as oil revenue climbed 22 percent, the country’s accountant-general said. But instead of the extra income resulting in increased savings, the Federation Accounts Allocation Committee (FAAC)

Wednesday deducted $1 billion (about N155 billion) from the Excess Crude Account (ECA) and shared it among the three tiers of government.

Also, a total of N520 billion was distributed among the tiers of government for July, bringing the total amount shared to about N675 billion.

Minister of State for Finance, Alhaji Yerima Ngama had recently announced that the committee was suspending further deductions from the ECA to allow it accumulate prior to further withdrawals. 

 “The Increased revenue was due to the increased quantity of crude oil exported this month,” Accountant-General of the Federation Jonah Otunla said in a statement e-mailed yesterday.

Oil revenue rose to 646.5 billion naira in the month, while non-oil revenue dropped 23 percent to 178.9 billion naira compared with June, Otunla said.

State-owned Nigerian National Petroleum Corp. said Aug. 2 the country’s crude oil output reached an “all-time high” of 2.7 million barrels a day on Aug. 1, after security improved in the southern oil-producing Niger River delta with the disarming of thousands militants under a government amnesty granted in 2009. 

Briefing journalists yesterday at the end of the monthly meeting of the committee in Abuja, Minister of State for Finance, said the ECA now stood at about $7.5 billion.

The minister said the committee had targeted to grow the ECA to about $10 billion by December, adding that the target was no longer far-fetched.

Ngama confirmed that gross revenue to the federation increased by N61.843 billion to stand at N825.396 billion for the month compared to N763.553 billion in the previous month. He also said the appreciation in revenue generated during the month was tied to the increased volume of crude oil exports as well as the lifting of deposit payments and receipt of NLNG sales (current and arrears) during the period.

Nigeria depends on oil exports for more than 80 percent of government revenue and 95 percent of export income, according to the Finance Ministry. 

According to the minister, N7.617 billion refund by the Nigerian National Petroleum Corporation (NNPC) was also distributed to the three tiers of government yesterday, as well as N35.549 billion proposed for sharing under the Subsidy Re-Investment Programme (SURE-P).

He said after transferring N60.276 billion into the Non-oil Excess Revenue, distributable statutory revenue for the month stood at N467.007 billion.

The minister added that the current position of the ECA would eventually offer relief in the event of a fiscal crisis, adding that it could even pay the states for three months in the event of any shortfall in future revenue.

He said the $1 billion deducted from the ECA was to support developmental programmes in the states.

Giving a rundown of the statutory allocations, the minister said the Federal Government got N217.770 billion, while the states shared N110.456 billion. 

The local governments, on the other hand, shared N85.157 billion, while N45.287 billion was allocated to the oil and gas-producing states under the derivation principle.

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