Nigeria’s Federal Government has started implementing Executive Order 9 of 2026, a new policy that mandates the direct remittance of oil revenues to the Federation Account Allocation Committee (FAAC).
The announcement was made by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy.
According to him, the decision follows a directive from Bola Ahmed Tinubu aimed at improving transparency and accountability in the management of Nigeria’s petroleum revenues.
The new policy requires revenues generated from petroleum operations to be paid directly into the Federation Account Allocation Committee, ensuring that funds meant for federal, state, and local governments are properly distributed in line with constitutional provisions.
NNPC to Stop Certain Oil Revenue Deductions
As part of the reforms, the government directed NNPC Limited to immediately stop deducting certain charges from profit oil and gas under Production Sharing Contracts.
These deductions include:
The 30% NNPC management fee
The 30% frontier exploration fund
The government also suspended the remittance of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund.
Officials say the measure aligns with the new executive order and is designed to improve how oil revenue flows into the national treasury.
Transition Period for Contractors
Although the policy takes effect immediately, the government approved a transition period before contractors begin paying directly into the federation account.
During this period, oil contractors will continue using the current remittance system until detailed guidelines are released.
The government explained that the transition is necessary to respect existing contracts and financing agreements while maintaining investor confidence in Nigeria’s oil and gas sector.
Technical Committee to Review Oil Revenue Framework
A technical subcommittee has been established to create operational guidelines for the new policy within three weeks.
The committee will also begin reviewing the Petroleum Industry Act to address structural and fiscal issues affecting national oil revenues.
The committee will include government legal advisers, revenue officials, and representatives from the oil sector.
Officials say the reform aims to ensure that Nigeria’s petroleum resources generate measurable economic benefits for citizens while strengthening transparency in the country’s oil revenue management system.
