POLITICS OF OIL REVENUE SHARING FORMULA IN NIGERIA: ISSUES AND CHALLENGES

This paper is entitled the politics of oil revenue sharing formula in Nigeria: issues and challenges examine the existing revenue sharing formula in Nigeria and the position of the Niger Delta states. It made use of secondary and primary data mostly from the Nigeria National Petroleum Corporation (NNPC). The paper found out that existing oil revenue sharing formula is unacceptable to the Niger Delta states hence the continuous agitations for resource control-or increase in allocation. Based on the findings, the paper recommended Production- Sharing Agreements (PSAs) formula as a better method. The formula is among the most common types of contractual arrangements for petroleum exploration and development. Under a PSA, the state (host) as owner of mineral resources, engages a foreign oil company (FOC) as a contractor to provide technical and financial services for exploration and development operations. The challenges of development in the case of Niger-Delta states are not a function of non-availability of funds, rather they have to do with the non-transparent and efficient management of the available resources. Full resource control without resource management is an effort in futility. This implies that substantial development revenue exists but it is misappropriated. ' Therefore, what is needed and badly lacking in the Niger-Delta accountability.