A law firm, Myson Law Practice has threatened to drag the Ondo state government to court over non-adherence to the disbursement of 40 percent of Ondo State Derivation Funds to the State Oil Producing Areas Development Commission (OSOPADEC) for the development of oil-rich communities.
The firm made the threat in a letter to the acting Governor of the state, Lucky Aiyedatiwa, dated July 24, 2023, and titled: “Exigent demand for strict adherence to OSOPADEC law and immediate disbursement of 40% of Ondo State Derivation Funds.”
Signed by Mysor Nejo, Esq. the firm noted that after 14 working days of the receipt of the letter and failure to remit the funds to the OSOPADEC account, it would commence the legal action.
Nejo lamented that the denial of OSOPADEC the statutory 40 percent from the 13 percent oil derivation funds accruing to the state government has significantly hindered the commission’s capacity to address the deplorable living conditions of people in the Ilaje and Ese-Odo local government areas, which he said to face "severe environmental hazards from oil exploration, socio-economic inequalities, limited access to healthcare and education, inadequate infrastructure, high unemployment rates, and recurrent flooding."
He reminded the state government that OSOPADEC was established by a law of the Ondo State House of Assembly in 2001 with the primary mandate to intervene in the development of oil-rich and impacted areas in Ondo State.
According to him, Section 6 of the law unequivocally provides that the Commission shall receive and administer exclusively 40% of the 13% oil derivation funds for the rehabilitation and development of oil-producing areas and other developmental projects as determined by the Commission. Also, the 1999 Constitution of the Federal Republic of Nigeria (as amended) in Section 162(2) designates the fund as compensation for the loss of fishing rights and productive farmlands resulting from oil and gas exploration and production activities.
He regretted that despite these explicit legal provisions, OSOPADEC has been unjustly deprived of its rightful entitlement by the state government, a development that has limited the capacity of the commission to discharge its obligation to the oil-producing areas in the state.
The letter reads, “On the 22nd day of July 2023, Ondo State received a substantial allocation of N2,968,156,301.71 billion naira from the Federation Account Allocation Committee (FAAC) as its share of the 13 percent derivation funds. As per the law, 40% of this sum, amounting to N1,187,262,520.68 billion naira, rightfully belongs to OSOPADEC.
“We hereby demand, unequivocally and by Section 162 of the Constitution and the OSOPADEC Law, that the Ondo State Government immediately remits the full 40% allocation to OSOPADEC's designated account within 14 days of receipt of this letter.”
The firm, however, warned that should the state government fail to comply with its legal obligation, it would be left with no option but to seek judicial intervention.
“Consequently, if this demand is not met, we shall initiate legal proceedings against the Ondo State Government to compel the immediate payment of the N1,187,262,520.68 billion naira to OSOPADEC.
“We will also seek a court order restraining the state government from diverting or tampering with the 40% of the 13% derivation funds accruable to Ondo State, in strict accordance with the provisions of the Ondo State Oil. Producing Areas Development Commission Law, Cap 106, Laws of Ondo State.
“A court order will also be sought to restrain the Federal Government from releasing the allocation belonging to Ondo State in the 13% derivation except for the statutory provisions in respect of OSOPADEC is complied with.”
The firm also noted that it would claim from the court all the outstanding sums of money which OSOPADEC is statutorily entitled to, since the commencement of Governor Oluwarotimi Akeredolu's administration, which has not been refunded or disbursed to the Commission appropriately in line with the Constitution and the OSOPADEC law.
“We strongly believe that upholding the rule of law and adhering to the clear stipulations of the Constitution and the OSOPADEC Law will promote equitable development and alleviate the sufferings of village and Ese-Odo Local Government Area who have long awaited the intervention they are entitled to through OSOPADEC.
“We trust that you will treat this matter with the utmost gravity it deserves, and we expect a prompt and decisive resolution that aligns with the principles of justice and the well-being of our region,” the lawyer said.