Tinubu Orders Direct Remittance of Oil and Gas Revenues to Federation Account

President Bola Tinubu has signed an executive order (EO) mandating that all oil and gas revenues be remitted directly to the Federation Account, in a move aimed at curbing waste, eliminating duplicative structures, and protecting national resources.

The EO, grounded in Sections 5 and 44(3) of the Constitution, restores revenue entitlements of the federal, state, and local governments that were curtailed by the 2021 Petroleum Industry Act (PIA). Under the current PIA framework, NNPC Limited retains up to 30% of profit oil and profit gas as a management fee, 20% of profits for working capital, and another 30% for the Frontier Exploration Fund—arrangements the government says are excessive and divert critical revenues.

“The additional 30% management fee is unjustified, given existing profit retention already covers NNPC’s operational needs,” the statement by Bayo Onanuga, Special Adviser to the President on Information and Strategy, noted.

Key Measures

NNPC Limited will no longer collect the 30% Frontier Exploration Fund or the 30% management fee.

All operators under production sharing contracts must remit Royalty Oil, Tax Oil, Profit Oil, Profit Gas, and related dues directly to the Federation Account from February 13, 2026.

Payments of gas flaring penalties into the Midstream and Downstream Gas Infrastructure Fund (MDGIF) are suspended; proceeds will now go directly to the Federation Account.

NNPC Limited will transition strictly to a commercial operator role, reducing conflicts from its dual functions as regulator and operator.

Oversight and Implementation

President Tinubu established an Implementation Committee to ensure compliance, including the Ministers of Finance, Budget, and State Petroleum Resources, the Attorney-General of the Federation, the Chairman of the Nigerian Revenue Service, and other key officials. A joint project team will coordinate integrated petroleum operations between upstream and midstream activities.

The President emphasized that the reforms are vital for national budgeting, debt sustainability, economic stability, and improving Nigerians’ welfare. He also announced a comprehensive review of the PIA to address fiscal and structural anomalies.

“The Executive Order is a decisive step to eliminate leakages, enhance transparency, and ensure Nigeria’s oil and gas revenues directly benefit the people,” the statement concluded.