Nigeria’s Federation Account recorded its highest quarterly disbursement in the third quarter of 2025, with N6 trillion shared among the federal, state, and local governments, according to the Nigerian Extractive Industries Transparency Initiative (NEITI).

The disbursement, detailed in NEITI’s Q3 2025 Quarterly Review, represents a 55.6% year-on-year increase and more than a twofold rise over the past two years, reflecting a sharp surge in shared revenues. A total of N9.62 trillion was disbursed by the Federation Account Allocation Committee (FAAC) between September and November 2025.

The N6 trillion included 13% derivation payments to oil-producing states, underscoring the major role of oil revenues in federal allocations.

A breakdown of the allocation showed:

• Federal Government: N2.19 trillion
• State Governments: N1.97 trillion
• Local Governments: N1.45 trillion

According to NEITI, statutory revenue accounted for 62% of shared receipts, VAT contributed 34%, while Electronic Money Transfer Levy (EMTL) and non-oil excess revenue augmentation each contributed 2%. An additional N100 billion came from the non-oil excess revenue account.

State Allocations

• Lagos: N179.3 billion (highest)
• Kano: N79.2 billion
• Rivers: N78.8 billion

At the lower end: Nasarawa received N42.5 billion, Ebonyi N42.9 billion, and Ekiti N43 billion. NEITI noted the allocation gap between the highest and lowest states was N136.8 billion for the quarter.

Among oil-producing states, Delta received the highest gross allocation of N180.68 billion, while Akwa Ibom, Bayelsa, and Rivers were also major beneficiaries. Collectively, oil-producing states received about N424 billion.

On debt, NEITI reported that deductions from states’ allocations for debt service totaled N225.89 billion, a 6.5% decline from the previous quarter, with an average debt service ratio of 9.4%, indicating improving fiscal sustainability at the subnational level.

Despite record inflows, NEITI warned of fiscal risks in Q4 2025, citing lower average oil prices and a decline in crude oil production from 1.64 million barrels per day in Q3 to 1.59 million barrels per day in the first month of Q4.

Delta Governor Sheriff Oborevwori encouraged state governments to leverage these resources to improve citizens’ welfare, dismissing claims that states lacked sufficient funds for development.