INTRODUCTION

1.1 Background of the Study

Since the inception of the entity called Nigeria following the 1914 amalgamation, there has been schemes, schedules, modes, methods and patterns of relationship among the federating units in terms of administration and finance (Chijioke et al, 2013). This according to Adeleke (2013: 145) was carried over to the post independence Nigeria where unrelenting struggle for resource control and revenue allocation has constituted a threat to the continued existence of Nigeria as one indivisible nation. The year 1957 marked a turning point in the history of Nigeria Federating nation as oil was discovered as its main source of economy, for instance, before then, the Northern part of the country is reputed for the production of groundnut pyramid, the West cocoa production while oil palm was produced in commercial quantity by the Eastern region (Adeleke, 2013). The crisis associated with the control of oil resources has to do with the formula for allocating the oil revenue among component units of the nation, in that each state is scheming and embarking on political manipulations with the intention of getting more allocation for its area (Adeleke, 2013).