Justice Taiwo O. Taiwo of the Federal High Court in Abuja has ordered the Buhari Government to pay Rivers and Akwa Ibom states $3,372,963,196.
Rivers will get $1,114,551,610.00 and Akwa-Ibom $2,258,411,586.
The money is the entitlement of Rivers and Akwa-Ibom States, based on the subsisting decision of the Supreme Court over production sharing contracts arising from the Deep Offshore and Inland Basin oil Production Sharing Contracts.
Justice Taiwo, delivered the judgment on Tuesday in Suit No. FHC/ABJ/CS/174/2021 filed by the Attorney General of Rivers State and Attorney General of Akwa Ibom against the Attorney General of the Federation.
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In 2016 Rivers, Bayelsa and Akwa Ibom States through their Attorneys-General sued the Federal Government, represented by the Attorney General of the Federation at the Supreme Court in Suit No: SC.964/2016.
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The three states sought a declaration that there is a statutory obligation imposed on the Defendant (the Federal Government) pursuant to Section 16(1) of the Deep Offshore Inland Basin Production Sharing Act, Cap.D3 Laws of the Federation of Nigeria 2004, to adjust the share of the Federation in the additional revenue accruing under the Production Sharing Contracts if the price of crude oil at any time exceeds twenty dollars ( $20.00USD) per barrel.
The States asked the court to declare that the failure of the Defendant to accordingly adjust the share of the Government of the Federation in the additional revenue in the Production Sharing Contracts (variously approved by the Defendant) following the increase of price of crude oil in excess of twenty dollars (20.00USD) per barrel in real terms, constitute a breach of the said Section 16(1) of the Deep Offshore and Inland Basin Production Sharing Contracts Act and has therefore affected the total revenue accruing to the Federation.
They argued that following the rules, the court should issue a consequential order compelling the Defendant to adjust the share of the Government of the Federation in the additional revenue under all the Production Sharing Contracts in Nigeria’s Oil Industry within the Inland Water Basin Deep Offshore areas as approved by the Defendant from the respective times the price of crude oil exceeded twenty dollars ($20.00USD) per barrel in real terms and to calculate in arrears with effect from August 2003 and recover and pay immediately all outstanding statutory allocations due and payable to the Plaintiffs arising from the said adjustments.
At the Supreme Court, the Attorney- General of the Federation opted for an out of Court settlement and consequently, terms of settlement were duly drawn up by the parties and entered as the judgment of the Court.
The judgment specifically stated that the reliefs in the amended originating summons relating to the larger interest of the Federal Government of Nigeria and the entire citizenry of the Federal Republic of Nigeria shall be diligently implemented.
It was also agreed that the Attorney General of the Federation, working jointly with the Plaintiffs should undertake to immediately set up a body and the necessary mechanism for recovery of all lost revenue accruing to the Federation Account in the past and up till the date of full recovery and accruing in future or an acceptable instalmental payments thereof within ninety (90) days next from the date of execution of these presents or its being made judgement of the Court.
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