A dispute has erupted between Oyo State Governor Seyi Makinde and the Presidency over Nigeria LNG Limited (NLNG) dividends, with Makinde alleging that the Federal Government is withholding about ₦250 billion due to each state, while the Presidency has dismissed the claim as mathematically implausible. The controversy centres on the distribution of nearly $3 billion in NLNG dividends reportedly received since President Bola Tinubu assumed office in May 2023 and an alleged ₦9 trillion shortfall owed to states and local governments.
Key Highlights
- Seyi Makinde alleges that each state is entitled to about ₦250 billion in NLNG dividends.
- The Oyo State Government claims a reconciliation exercise identified an alleged ₦9 trillion shortfall involving states and local governments.
- The Presidency, through spokesman Bayo Onanuga, has rejected the allegation, citing NLNG’s historical dividend payments.
- The Federal Government says NLNG has paid approximately $21.5 billion in dividends to the Federation over 25 years.
- Makinde is demanding a detailed account of the nearly $3 billion in NLNG dividends reportedly received under Tinubu’s administration.
- The controversy has renewed calls for transparency in Federation Account revenue sharing and FAAC allocations.
Makinde Questions Distribution of NLNG Dividends
Makinde raised the issue during a 2027 Budget Stakeholders’ Consultative Engagement in Ibadan, where he alleged that each state was supposed to receive approximately ₦250 billion from an NLNG dividend windfall.
According to the governor, the Federal Government had indicated that the funds would not be released until after the 2027 general elections.
The Oyo State Government subsequently expanded on the allegation, claiming that the Nigeria Governors’ Forum (NGF), with support from the Federal Government, had commissioned a consultant to reconcile NLNG dividend payments.
According to Makinde’s media office, the exercise reportedly identified a shortfall of approximately ₦9 trillion owed to states and local governments. The Oyo government further alleged that the Federal Government had accepted the findings.
However, the reconciliation report and the alleged acceptance of the shortfall have not been independently established by the information available.
Makinde’s camp has demanded answers to four key questions: whether states and local governments received their respective shares, how much each tier of government received, how the allocations were calculated, and what happened to the nearly $3 billion in NLNG dividends reportedly received since Tinubu took office in 2023.
Presidency Rejects Makinde’s ₦250bn Per State Claim
Presidential spokesman Bayo Onanuga has rejected Makinde’s allegation, describing it as false and urging Nigerians to disregard it.
Onanuga argued that the governor’s claim does not align with the scale of NLNG’s historical dividend payments or Nigeria’s revenue-sharing formula.
According to the Presidency, states receive 26.72 per cent of distributable Federation Account revenue. On that basis, a total allocation of ₦9 trillion to the 36 states would require a distributable pool of more than ₦33.68 trillion.
The Presidency argued that such a figure would be inconsistent with NLNG’s reported historical dividend payments.
Onanuga said NLNG had paid approximately $21.5 billion in dividends to the Federation over 25 years, with less than $3 billion reportedly received since Tinubu assumed office in May 2023.
He maintained that NLNG had never made a single dividend payment of $25 billion, making the amount implied by Makinde’s claim implausible if interpreted as a single payout.
The Presidency also urged the governor to exercise restraint in his public statements and linked the controversy to the political climate ahead of the 2027 elections.
What the Figures Reveal About the NLNG Dividend Dispute
The competing claims centre on two related but distinct issues: whether the amount cited by Makinde is mathematically plausible and whether all NLNG dividend receipts have been properly accounted for and distributed.
On the first question, the Presidency’s argument challenges the interpretation that each state is owed ₦250 billion from a single NLNG dividend declaration.
If the 36 states were collectively entitled to ₦9 trillion under the stated 26.72 per cent revenue-sharing formula, the implied distributable pool would be approximately ₦33.68 trillion. That figure would exceed NLNG’s reported lifetime dividend payments to the Federation when compared at the stated dollar equivalent.
However, Makinde’s subsequent response shifts attention towards the alleged reconciliation exercise and the distribution of actual receipts.
If nearly $3 billion in dividends entered the Federation Account under the current administration, the relevant public-interest questions include how the funds were recorded, converted into naira, distributed through the Federation Account Allocation Committee (FAAC), and reflected in allocations to states and local governments.
A detailed transaction-by-transaction reconciliation would help establish whether any discrepancies exist.
How NLNG Dividends Are Shared Among Governments
NLNG dividends do not automatically translate into equal payments to each state. The receipts enter the Federation Account and are distributed according to Nigeria’s applicable revenue-sharing arrangements, subject to relevant statutory deductions and other adjustments.
The Federal Government, state governments and local governments receive allocations in accordance with the applicable sharing formula.
Consequently, the amount a state receives depends on factors including the distributable revenue, the applicable allocation formula, exchange-rate conversions, the period covered and any lawful deductions or reconciliation adjustments.
This makes it important to distinguish between gross NLNG dividend receipts and the net amount available for distribution.
Without a clear breakdown of the relevant period, total receipts, conversion rates and allocation calculations, the claim that each state is owed a specific amount cannot be conclusively assessed.
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Three Major Questions Remain Unanswered
Despite the exchange between Makinde and the Presidency, three important issues require documentary clarification.
1. The alleged ₦9 trillion reconciliation report
The Oyo State Government says a consultant engaged through an NGF-related exercise identified a shortfall involving states and local governments. The report’s full findings, methodology and scope need to be made public for independent assessment.
2. The alleged acceptance of the shortfall
Makinde’s camp claims the Federal Government accepted the reported findings. Documentary evidence is needed to establish whether the government formally acknowledged any liability and, if so, the amount involved.
3. The distribution of nearly $3 billion in dividends
A detailed account of NLNG dividend receipts since May 2023, including the relevant Federation Account entries and FAAC allocations to each tier of government, would help clarify the dispute.
The Presidency has challenged the scale of Makinde’s allegation but, based on the reports cited, has not provided a complete transaction-by-transaction reconciliation of the recent receipts.
Transparency Needed to Resolve the Controversy
The disagreement highlights a wider governance concern about the transparency of Nigeria’s public revenue management.
Large receipts from oil, gas, liquefied natural gas, taxes and other sources frequently generate controversy when state governments and the public cannot easily trace how gross revenue becomes net Federation Account allocations.
Publishing the NLNG dividend receipts, the exchange rates applied, the Federation Account entries, FAAC distribution calculations and the reconciliation report cited by Makinde would provide a clearer basis for resolving the matter.
Such disclosure would help determine whether the alleged ₦9 trillion shortfall is supported by evidence or whether the governor’s interpretation of the figures is incorrect.
Conclusion
The dispute between Seyi Makinde and the Presidency over NLNG dividends has raised important questions about revenue sharing, fiscal accountability and transparency in Nigeria.
While the Presidency has challenged the mathematical basis of the claim that each state is owed ₦250 billion, Makinde is demanding an explanation of how the nearly $3 billion in dividends reportedly received under Tinubu’s administration was distributed.
Until the relevant reconciliation report and detailed allocation records are made public, the alleged ₦9 trillion shortfall remains unverified.
A transparent, evidence-based accounting of the receipts and disbursements would provide the clearest way to settle the controversy and strengthen public confidence in the management of Nigeria’s Federation Account.
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