By Our Correspondent
Bayelsa State emerged as the second-largest beneficiary of Nigeria’s 13 per cent derivation revenue in the first quarter of 2026, receiving N71.64 billion out of the N321.90 billion shared among the country’s oil-producing states between January and March.
The allocation places Bayelsa behind Delta State, which received N101.60 billion during the three-month period, while Akwa Ibom ranked third with N69.39 billion.
Together, Delta, Bayelsa and Akwa Ibom accounted for approximately 75 per cent of the total derivation funds distributed to oil-producing states during the quarter, highlighting the continued dominance of the Niger Delta in Nigeria’s petroleum revenue structure.
The figures were contained in an analysis by BudgIT Nigeria, based on data from the National Bureau of Statistics and the Federation Account Allocation Committee.
According to the analysis, 11 states received derivation payments during the first quarter of the year, with Bayelsa’s N71.64 billion representing one of the largest quarterly allocations to an individual state under the derivation principle.
Rivers State, another major oil-producing state in the Niger Delta, received N46.09 billion to rank fourth. Collectively, Delta, Bayelsa, Akwa Ibom and Rivers accounted for almost 90 per cent of the total derivation funds distributed to oil-producing states during the period.
The figures underline the enormous contribution of the Niger Delta to Nigeria’s petroleum economy and the extent to which states in the region remain dependent on derivation revenues arising from crude oil and gas activities within their territories.
For Bayelsa, the N71.64 billion allocation comes against the backdrop of the state’s longstanding position as one of Nigeria’s major oil-producing territories. Despite its relatively small geographical size, Bayelsa hosts significant oil and gas assets and has continued to play a strategic role in the country’s petroleum industry.
The state is home to several oil-producing communities and hosts extensive upstream operations, pipelines and other petroleum infrastructure. The latest derivation figures therefore place renewed attention on the relationship between the resources extracted from Bayelsa and the revenues accruing to the state under the constitutional derivation arrangement.
Other states recorded substantially lower allocations. Ondo received N9.39 billion, Edo N7.47 billion, Imo N7.39 billion, Abia N5.42 billion and Anambra N3.49 billion.
The two newest states on the list of oil-producing states, Enugu and Kogi, received only N46,991 each during the quarter, reflecting their currently marginal contribution to national crude oil production.
The wide disparity in the figures illustrates the uneven distribution of petroleum production across the country. States with established oil fields, higher production volumes and extensive petroleum infrastructure continue to receive significantly larger derivation payments than emerging oil-producing states.
Delta’s N101.60 billion, for instance, was more than two million times the amount received individually by Enugu and Kogi.
The figures also put Bayelsa’s N71.64 billion in perspective. Although the state ranked second nationally, its allocation was about N30 billion lower than Delta’s and approximately N2.25 billion higher than Akwa Ibom’s.
The substantial derivation revenue accruing to Bayelsa is expected to sustain discussions over the effective utilisation of oil revenue, particularly in relation to infrastructure development, human capital development, environmental protection and the improvement of living conditions in oil-producing communities.
For decades, communities in the Niger Delta have complained that the benefits derived from petroleum extraction have not adequately reflected the environmental and socio-economic costs associated with oil exploration and production.
The issue remains particularly significant in Bayelsa, where oil-producing communities continue to contend with challenges associated with environmental degradation, inadequate infrastructure and limited access to basic amenities.
Under Nigeria’s constitutional arrangement, oil-producing states are entitled to 13 per cent of the revenue derived from natural resources extracted from their territories. The derivation principle is designed to compensate states for hosting and contributing natural resources to the national economy.
However, because the allocation is largely influenced by production volumes, states with higher oil output receive considerably larger sums, while states with marginal production receive much smaller amounts.
The latest figures also show that derivation payments to oil-producing states have increased considerably in recent years.
In 2025, the states collectively shared N1.51 trillion in derivation revenue, compared with N671.9 billion in 2024. The increase reflects both changes in revenue flows and the expansion of the number of states recognised as oil-producing states.
The number of beneficiary states has risen from nine to 11 following the recognition of Enugu and Kogi as oil-producing states. However, their first-quarter allocations remain negligible compared with those of established producers such as Bayelsa, Delta, Akwa Ibom and Rivers.
For Bayelsa, the latest N71.64 billion quarterly allocation further reinforces the state’s importance to Nigeria’s petroleum economy. It also raises questions about how effectively derivation funds are being translated into sustainable development, particularly in the communities where the resources generating the revenue are extracted.
With the Niger Delta continuing to account for the overwhelming majority of derivation payments, the challenge for the region is increasingly shifting from securing revenue recognition to ensuring that such revenues produce visible and lasting improvements in the lives of its people.
Bayelsa’s position as the second-largest recipient in the first quarter therefore represents not only the economic significance of its oil resources but also an opportunity for the state to channel petroleum-derived revenues into projects capable of reducing dependence on oil and building a more diversified and sustainable economy.
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