Abia State Governor, Chief Theodore Orji, tells Sweetcrude team, Clara Nwachukwu, and Ubong Nelson, in an exclusive chat on the 13 percent derivation fund for oil and gas producing states is not equitably distributed, as derivation should be based on production capacity.

Excerpts:

How did your administration come up with the idea of the Abia State Oil Producing Areas Development Commission, ASOPADEC?

A committee was set up to look into the creation of the commission in 2010, and with the bill the committee came up with specifics. The chairman of the Commission is from an oil producing area of Abia state, and since we created the commission, we are keeping to the dictates of the law.

How are the accruable funds disbursed or utilised?

From the 13 per cent of what we derive we give 30 per cent of it to ASOPADEC; we don’t add we don’t remove. Once the 13 per cent comes, 30 per cent goes to the Commission’s account and it is a standing order and we have been religiously being doing that.

The chairman of the commission has been doing very well, and I am sure they must have shown you projects they have carried out in every sector of the state economy – is it education, water or electricity, security, construction of roads and youth empowerments. Paying of school fees and WACE fees for indigent students in SS3 class? To be honest with you, I’m proud of what the Commission has done so far.

In terms of power, we have evacuated power from Ohia sub-station; it is from the 13 percent we got the money to do the project. We also use 30 per cent on infrastructures, empowerment, and we gave N100million to the state University, Polytechnic and College of Education.

We are running free education from primary to secondary school levels here, so the students don’t pay anything. We have to show example that we are an oil producing state, and it is from our 13 per cent derivation that we fund most of our projects.

We also support our students for external competitions which they attend and perform very well. Recently, the chairman of the commission told me about a presidential essay competition/debate organised in Abuja, in which we came second, and Bauchi came first. There is another competition and our students are doing extremely well.

In your opinion, would you say the funds are being utilised judiciously and are the host communities given preferential treatment in the disbursement of the funds?

We are indeed very prudent in the utilisation of this 13 per cent oil derivation. But of recent, I’m sure the chairman must have told you that we have sent kidnappers packing and they have devised a means of making money and that is by attacking the pipelines, stealing the crude oil, selling them, and sometimes refining them which affects our allocations at the federal level and this allocation is based on what we produce.

When these boys engage in these nefarious acts, there are at times that we receive very little from the federal government, and when money does not come like that 30 per cent of 13 per cent derivation fund that we give to ASOPADEC will be drastically be affected.

Yes, the oil producing areas are given preferential treatment because that is where the money is coming from. An example of such preferential treatment is that oil comes from Ukwa West, all the traditional rulers there were given sport utility vehicles, SUVs, from that money so that they can have a sense of belonging, and for them to say, yes, this is what we a gaining from the money gotten from our communities. The gesture was also meant to boost their energy and the passion to chase away anybody that is destroying the pipelines, and they can also provide us with useful information about the people who carry out the act of pipeline vandalism and kidnapping.

When we are paying for examination fees, we also give preference to that area even though it is for all Abians; we still give them preference so that they don’t become restive, and start saying that they are not seeing anything from the oil coming from their communities.

We understand that there is no particular formula for arriving at the derivation, is that true?

Yes, there is no particular formula in allocation sharing and that is why we are asking for the restricting of the partner of revenue allocation at the federal level.

You cannot imagine Abia that is producing oil receiving less revenue allocation while a state that is not producing oil is getting more than the oil producing states; maybe their population is bigger than Abia. In revenue allocation, population is included when the sharing is done, and by the last census, we were 2.8 million people.

What we are saying is that if the revenue is to be shared, it should be done very well, equitably distributed and based on what we produce. Like I said earlier, when the issue of pipeline vandalism started in our state, it affected our revenue allocation drastically because they check the quantity that comes from your oil wells, and based on that they do the allocations. So if you don’t produce anything, nothing comes to you from the federal level.

Akwa Ibom, Rivers, Delta and Bayelsa are states that are wealthy because of the number of oil wells they have.

Speaking about oil wells, what is the situation with the disputed oil wells is the state still pursuing the case?

The truth is that they (Boundary Commission) have to come and streamline the whole thing as they use demarcation in determining oil wells. The oil wells have already been shared that is why Rivers State is protesting, and we too are protesting. Some oil wells are for us but other states are claiming it. We, the governors have discussed it severally so that they can come and do proper delineation of boundaries, and the federal government should do it to resolve all these boundary issues.

Looking at other government agencies such as the NDDC and Niger Delta Ministry, set up to assist in the development of the oil region; do you collaborate with them to support your development projects?

We are a member of the two bodies, since we produce oil we belong to Niger Delta Development Commission, NNDC, and the Ministry of Niger Delta also takes care of Abia and we partner with them. In terms of their projects we are there and some projects are allocated to Abia. They do road projects; they build bridges, housing, education, scholarships etc.

We see the adverts on the pages of newspapers, although, preference is also given to some states because you cannot, for instance, compare Abia State with Akwa Ibom in terms of production and in terms of money. Since the money that is used for the projects is gotten collectively, common sense demands that it should be shared that way. If you produce 90 per cent and when you are doing a project, they give you one percent, will you be happy? And give somebody who is producing 30 per cent and they him 90 per cent for his project. They give preference to the quantity of oil you produce.

What about your relationship with the oil companies like Shell that is operating in your state?

Usually we have to force them (oil company) to come and do something. Also, they give the local governments preference and say the oil is in control of the local government chairman; because those are the people that battle them. And I believe once the money comes whether it is given to us or the local government it comes to Abia State.

You will not believe that all the revenue that comes, Shell pays to the local government because the oil well is located within the local government territory. In terms of projects too, the communities have to force them to come give them good roads, electricity and other basic amenities.

Would you then say the oil companies are living up to their responsibilities?

Not at all, not at all compared with the advantages they derive from here. And that is why you have these agitations and restiveness in Niger Delta area, and kidnapping; it is because of this. The oil companies that is operating here don’t perform as expected. If they gave performed as expected, the youths here will be happy and every other person will be happy, but because they are performing you will find the youths fighting and kidnapping.

In view of dwindling resources on account of pipeline vandalism, what are your plans to continue to support the various projects in the oil communities?

We have alternative plans and that is to increase our Internally Generating Revenue (IGR) because that is where the salvation will come from. Even if they are not good at paying taxes, they have to pay; we cannot say that because they are not good at paying we will keep quiet.

In Abia, especially in Aba, go and ask who is paying tax, they will start laughing because when we go on sensitiasation programmes or rallies, we will ask them to show us their tax receipts, and they start to laugh because they have none. But we have to make them to be conscious of their civic responsibilities that they have to pay tax. We have to get the money from the people through tax, which is legitimate and they, in turn, will see what we have used them for, in providing their basic needs. We have to achieve this by shouting and we have to be aggressive about it on generating internal revenue.

We have also employed consultants that will help us and we are seeing results, as we now get money from IGR. If the expected revenue comes in, we will not be worried that much but because the state is not generating enough revenue, we have to depend on the allocation at the federal level.

Energy is identified as key to development, what policies have you put in place to boost the sector?

Energy is the key to good governance. If we don’t have it nothing will work; production will be zero, factories will not run, there will be nothing moving and that is one of the reason why we are moving on a slow rate in terms of development because of lack of energy.

Conscious of that, in Abia we have this energy project in Alaoji which is close to completion. When it is completed, the whole of Aba and beyond will be energized. In that same Aba, Osisioma local government which is very close, we have another private power project by Geometric Power that will inject 188, MW, (mega watts) into the system which is about to be completed. It is also targeted at Aba and environs and even Onitsha, in Anambra State because these are productions areas.

When that one comes on stream and the one in Alaoji comes on stream too, the issue of power will have been solved. There is one 32KVA Sub power station, there is power there but our problem was how to evacuate them to the feeder station to feed the people. That has been done and it was commissioned by the Minister of Power, Prof. Barth Nnaji, and that is why wherever you are staying, be it in an hotel or anywhere, there is constant power supply. It was not like this before, if it was before since we started this interview, power supply will have gone off about two to three times and we will be battling with our generating sets.

But now there is no noise from the generators, which indicate that the source of the power is direct from the transmission we have done. We want to extend it because this one has captured the whole of Umuahia and environs, it has also been extended to Mbaino, that is in Imo state and they are enjoying it, we will extend it to Isiala Ngwa North and South which we are currently working on.

When we have achieved that then we will know that we have taken care of the whole of this place, and will be waiting for Geometric to take care of Aba, and then we will be home and dry.

Apart from that also, we are discussing with a foreign firm that wants to come and put a power plant in Abia, but we are still discussing on that, the ones we have seen is the one that we are sure to work with.