President Bola Ahmed Tinubu has signed an Executive Order, effective February 13, 2026, mandating that all oil and gas revenues in Nigeria be remitted directly to the Federation Account, a move aimed at strengthening fiscal transparency and realigning revenue flows with constitutional requirements.
The order comes as a corrective measure against long-standing deductions and fees previously allowed under the Petroleum Industry Act (PIA 2022), which permitted the Nigerian National Petroleum Corporation Limited (NNPCL) to retain 30% of oil revenues as a management fee and 20% of profits for working capital and future investments. According to the Presidency, these arrangements created inefficiencies and reduced net inflows to the Federation despite improved crude oil production and prices.
Under the new directive, all operators of oil and gas assets under production sharing contracts will pay royalty oil, tax oil, profit oil, profit gas, and other interests directly to the Federation Account, effectively blocking deductions at source. The Order also suspends payments of gas flare penalties into the Midstream Gas Infrastructure Fund (MDGIF).
The legal basis for the Order is Sections 5 and 44(3) of the Constitution, which vest ownership and control of all minerals, mineral oils, and natural gas in the federal government. The Presidency says the move will curb leakages, enhance transparency, eliminate duplicative structures, and reposition NNPCL strictly as a commercial enterprise.
President Tinubu has approved an implementation committee, including the Minister of Finance and Coordinating Minister of the Economy, the Attorney-General of the Federation, the Minister of Budget and National Planning, and the Minister of State for Petroleum Resources, to oversee effective execution of the Order.
Experts in the sector have described the directive as “bold and historic” and “a landmark step towards fiscal discipline and transparency in the management of Nigeria’s oil wealth,” noting that it corrects a fiscal imbalance created by the PIA, which previously allocated about 60% of oil revenues to NNPCL and affiliated bodies, leaving only 40% for federal, state, and local governments.
Stakeholders stress the importance of institutional safeguards to ensure the policy achieves its goals, emphasizing that the Order enhances public scrutiny, reinforces trust, and aligns Nigeria with global best practices in public financial management.
The Presidency maintains that the move reflects the administration’s commitment to fundamental reforms, fiscal discipline, and strengthened public institutions in managing the country’s strategic oil and gas resources.
