Excess Crude Account: FG, States fail to reach settlement

The dispute between the Federal Government and the 36 states of the federation over the management of the revenue accruing to the federation keeps lingering as the states has asked the Supreme Court to go ahead on adjudicating on the suit challenging the operation of the Excess Crude Account (ECA). The states told the court that they had lost confidence in the ability of the Federal Government to reach an out-of-court settlement with them on the dispute and it should proceed with definite hearing of the case.

Chief Adegboyega Awomolo (SAN), who represented the states, told the court that his clients wanted the case decided on merit since the parties had not been able to come up with amicable settlement terms. Awomolo insisted that the matter before the court was a constitutional one and not political. He prayed the court to hear and give a definite pronouncement on the suit, which has been pending since 2008.

Subsequently, the Supreme Court fixed May 9, 2013 for reports of settlement. It also ordered the parties to make sure that all processes were filed before that day.

The 36 states of the federation had sued the Federal Government over plans to transfer $1 billion from the ECA to a new account known as the Sovereign Wealth Fund. But the Federal Government sought to settle the matter out of court. Based on the application, the Supreme Court afforded the parties the opportunity to settle the matter and report back with the report of settlement. This, the parties had failed to achieve.

Excess Crude Account: FG gets New Settlement Terms from states

States have proposed new conditions to resolve the lingering dispute between them and the Federal Government over illegal deductions from the Federation Account. Counsel to the Federal Government, Mr. Austin Aleghe, informed the Supreme Court of the new development when hearing resumed in the suit filed by the states seeking, among others, an order of the court to stop further deductions from the ECA to fund payment for fuel subsidy pending the determination of the suit.

According to the proposed new terms of agreement, the Federal Government will undertake and agree that upon the execution of the terms of settlement, it shall cause all sums standing to the credit of the ECA to be transferred to the Federation Account and distributed within 10 days from the execution of the terms of settlement to the three tiers of government—federal, state and local governments.

Under the new terms, the states are demanding that a limited liability company be established to take over the operations of the National Integrated Power Projects (NIPP) and the $8.425 billion invested in it. They are also demanding that the shares be allotted to the Federal Government, the states and the 774 local government areas with the rights and obligation of each shareholder spelt out.

Similarly, the states are demanding that the $250 million invested in the railway modernisation projects be transferred to a limited liability company, to be formed, in which the Federal Government, the states and the local government areas shall be the shareholders.

Onshore-Offshore Dichotomy: FG Forecloses Review

The Federal Government has ruled out revisiting the issue of the onshore-offshore oil dichotomy. Attorney General of the Federation (AGF) and Minister of Justice, Mr. Mohammed Bello Adoke, stated the government’s position on the issue, which has already pitted the North against the South, at a valedictory session in honour of Justice Francis Fedode Tabai at the Supreme Court, Abuja.

He warned politicians and legal practitioners to avoid overheating the polity through the current debate on the need or otherwise to review the onshore-offshore oil dichotomy, which partly forms the basis for the allocation of derivation proceeds from the Federation Account.

His warning came against the backdrop of the clamour for a review of the onshore-offshore oil dichotomy by Northern governors who hold the view that the formula has reduced the distributable funds from the Federation Account to all tiers of government. However, their counterparts from the South-south and people of the oil-producing littoral states have rejected their position and even demanded that the derivation formula be raised from the current 13 per cent to 50 per cent.  Adoke said the debate, which is being elevated to an urgent national matter, with all the potential to generate acrimonious wrangling within the polity, and being made to look as if it was new, had been determined by the Supreme Court long time ago.

Oil Wells: Cross River turns down N250m monthly largesse from Akwa Ibom

The Cross River state government has rejected the N250 million monthly payments from akwa Ibom state saying that it was a degrading offer which portrayed the leadership of Cross River as opportunistic and irresponsible. This was made public by the Cross River state Attorney-General and Commissioner for Justice Mr Attah Ochinke at a press conference. Ochinke said it was not correct to say that Cross River rejected overtures for amicable settlement with Akwa Ibom rather the Cross River government went to court to enforce the settlement that had already been reached.

According to him, "The matter had been settled and agreement written and it was implemented for three years, so what has happened for the parties to now withdraw from that agreement?
The government of Akwa Ibom said they offered us when the matter was in court, N250 million a month as a peaceful settlement on the matter. I do not know when the matter will be settled but I am very certain of one thing, if we do not recover the territory it is not because it does not belong to us, but because we are unable to recover the territory”.

It would be recalled that the Supreme Court had in recent judgement ceded 76 oil wells which Cross River laid claims to Akwa Ibom. In the aftermath of the judgment, Gov. Godswill Akpabio of Akwa Ibom had offered to pay Cross River N250 million as grant to cushion the pains of the loss.