Tinubu Orders Direct Remmitance of All Oil, Gas Revenues into Federation Account
President Bola Ahmed Tinubu has signed an executive order mandating that all oil and gas revenues due to the Federal Government be paid directly into the Federation Account, marking a major overhaul of Nigeria’s petroleum revenue framework.
The Presidency said the directive is designed to strengthen public finances, improve transparency and address revenue leakages that have constrained allocations to the federal, state and local governments.
Under existing arrangements, the Nigerian National Petroleum Company Limited retains 30 per cent of oil and gas profits for frontier exploration in inland basins, as well as 30 per cent of oil and gas sales for operational costs and another 30 per cent of proceeds from Production Sharing Contracts.
The new order abolishes these deductions, directing that all such revenues be remitted in full to the Federation Account, while NNPCL will henceforth receive only government-approved management fees through appropriation.
In addition, royalty payments, petroleum profit taxes and other statutory revenues previously collected and retained by the Nigerian Upstream Petroleum Regulatory Commission will now be paid directly into the Federation Account. The Nigerian Midstream and Downstream Petroleum Regulatory Authority has also been directed to remit all its revenues in full, with its cost of collection to be funded through budgetary appropriations.
According to the Presidency, the deductions permitted under the current legal framework had significantly reduced net oil revenues and worsened fiscal pressures across all tiers of government. President Tinubu has therefore ordered a comprehensive review of the law and set up an implementation committee to ensure full enforcement of the reforms.
Officials say the measures are expected to enhance revenue transparency, boost monthly allocations and restore confidence in the management of Nigeria’s oil and gas earnings.