Tinubu Signs Executive Order for Direct Remittance of Oil and Gas Revenues to Federation Account
- President Bola Tinubu has signed an executive order requiring all oil and gas revenues to be paid directly into the Federation Account
- The directive mandates operators under production sharing contracts to remit Royalty Oil, Tax Oil, Profit Oil and Profit Gas straight to the central revenue pool
- The President has also announced plans to review the Petroleum Industry Act and constituted an implementation committee to oversee the reform
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Oluwatobi Odeyinka is a business editor at Legit.ng, covering energy, the money market, technology and macroeconomic trends in Nigeria.
President Bola Tinubu has signed an executive order mandating the direct payment of oil and gas revenues into the Federation Account, in a move aimed at strengthening public finances and curbing revenue leakages in the petroleum sector.
The directive, signed pursuant to Section 5 of the Constitution, seeks to enforce the federal government’s constitutional ownership and control over mineral resources as provided under Section 44(3).
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According to a statement by the Special Adviser to the President on Information and Strategy, Bayo Onanuga, the new order requires all operators and contractors holding oil and gas assets under production sharing contracts to remit Royalty Oil, Tax Oil, Profit Oil, Profit Gas and any other government-entitled revenue directly to the federation account.
The order, which took effect on February 13, 2026, is designed to reverse what the presidency described as structural and fiscal distortions introduced by the Petroleum Industry Act (PIA).
The Tinubu administration argued that various deductions and charges embedded in the current framework significantly reduce net inflows to the federation account.
Under the revised arrangement, revenues previously routed through certain industry funds and corporate structures will now be paid straight into the central revenue pool shared by the federal, state and local governments.
Proceeds from gas flare penalties
The President also directed that proceeds from gas flare penalties, which were previously paid into the Midstream and Downstream Gas Infrastructure Fund, be remitted directly to the federation account going forward.
The statement noted that spending from the fund will now be subject to existing public procurement laws and financial regulations.
Oil reforms to protect govt revenues
The Presidency said the reform is necessary to protect government revenues at a time of mounting fiscal pressures and rising expenditure demands. It noted that oil receipts remain critical to national budgeting, debt management, economic stability and funding for security, healthcare, education and energy transition initiatives.
In addition, President Tinubu announced plans for a broader review of the Petroleum Industry Act in consultation with stakeholders to address what the government described as fiscal and structural anomalies within the law.
Source: Facebook
An implementation committee comprising senior government officials, including the Minister of Finance, the Attorney-General of the Federation, the Minister of Budget and National Planning, and the Minister of State for Petroleum Resources (Oil), has been constituted to oversee the execution of the directive.
The administration said the measures are of urgent national importance and are expected to improve transparency, eliminate overlapping deductions and enhance revenue flows to the three tiers of government.
Nigeria earns N55.5tn from crude oil sales in 2025
Legit.ng reported that Nigeria generated an estimated N55.5 trillion from crude oil sales in 2025, up from N50.88 trillion in 2024.
The estimate was based on official production data from NUPRC and crude price figures from the CBN.
Analysts noted that the figure does not reflect actual government earnings due to costs and other deductions.
Source: Legit.ng
