President Bola Tinubu has signed a new Executive Order aimed at strengthening the remittance of oil and gas revenues into the Federation Account and improving accountability across Nigeria’s petroleum sector.
The directive was announced by the President’s Special Adviser on Information and Strategy, Bayo Onanuga, who said the measure is designed to curb wasteful spending, eliminate overlapping structures, and ensure that national resources are better utilised for the benefit of Nigerians.
According to the Presidency, the Executive Order was issued pursuant to Section 5 of the Constitution and anchored on Section 44(3), which vests ownership and control of mineral resources in the Federal Government.
The government said the order seeks to restore the constitutional revenue entitlements of the Federal, State, and Local Governments, which were significantly affected following the implementation of the Petroleum Industry Act in 2021.
Under the current framework, NNPC Limited retains 30 percent of the Federation’s oil and gas revenues as a management fee from production and profit sharing contracts. Officials argued that this additional retention is unnecessary because the company already holds retained earnings considered sufficient for its operational responsibilities.
The statement also raised concerns about the Frontier Exploration Fund, which receives another 30 percent of oil and gas profit for exploration activities. Government officials warned that the scale of the fund could lead to idle cash balances and inefficient spending at a time when resources are urgently needed for security, education, healthcare, and energy transition programmes.
The Executive Order further highlighted duplication in funding environmental initiatives, noting that the Nigerian Upstream Petroleum Regulatory Commission already administers an Environmental Remediation Fund for communities affected by petroleum operations.
The Presidency said the reforms are expected to enhance transparency, boost revenue flow, and strengthen fiscal discipline in Nigeria’s oil and gas sector.
