The Federal Government has approved a transition period for the implementation of direct remittance of oil revenues into the Federation Account, as provided under Executive Order 9 signed by President Bola Ahmed Tinubu.
The decision followed the inaugural meeting of the Implementation Committee on Executive Order 9 of 2026 held on February 26, 2026.
In a statement issued on Monday, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, who chairs the committee, said the transition window would allow the new regime to take effect without disrupting existing contractual and financing structures in the oil and gas sector.
The policy stems from Executive Order 9, which mandates that revenues from petroleum operations — including profit oil, royalty oil and tax oil — be paid directly into the Federation Account to safeguard public funds and strengthen the finances of the three tiers of government.
Edun said the committee agreed that the shift must be carefully managed to preserve investor confidence while protecting Nigeria’s revenue base.
“With respect to Section 2, Sub-section 3 of Executive Order 9 on direct payments by contractors into the Federation Account, the Implementation Committee agreed that this transition must be implemented in a manner that respects existing contractual and financing arrangements and maintains investor confidence,” he stated.
He disclosed that contractors would continue to remit revenues under the current framework until detailed operational guidelines are issued.
“Until the Committee releases clear, standardised guidance, contractors will continue to remit under the existing process. The transition period will ensure an orderly changeover to the new system,” Edun added.
To drive the process, the committee approved the establishment of a technical subcommittee tasked with developing the operational framework for direct remittance within three weeks.
The subcommittee will also commence a review of the Petroleum Industry Act to address structural and fiscal anomalies said to be weakening revenues accruing to the Federation.
According to Edun, the review will focus on provisions that may undermine government earnings from petroleum operations.
“The Technical Subcommittee will develop detailed guidelines for the transition within three weeks and begin a review of the Petroleum Industry Act to address structural and fiscal anomalies that weaken Federation revenues,” he said.
The panel will be chaired by the Special Adviser to the President on Energy, Olu Verheijen, and will include the Solicitor-General of the Federation and Permanent Secretary, Federal Ministry of Justice; the Chairman of the Nigeria Revenue Service; the Chairman of the Forum of Commissioners of Finance; representatives of the Minister of State for Petroleum Resources (Oil); while the Budget Office of the Federation will serve as secretariat.
The committee reiterated that the reforms are aimed at ensuring that oil and gas revenues are fully accounted for and paid into the Federation Account in line with constitutional provisions.
It also reaffirmed the President’s directive that petroleum revenues must be managed in a manner that protects public funds and supports fiscal stability at federal, state and local government levels.
As part of the measures under Executive Order 9, the government directed the NNPC Limited to discontinue certain deductions under Production Sharing Contracts.
Specifically, NNPC Limited is to halt the collection of a 30 per cent management fee and a 30 per cent frontier exploration fund deduction from profit oil and profit gas. The directive takes immediate effect.
In addition, all remittances of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund have been suspended with immediate effect in line with the Executive Order.
The implementation committee assured stakeholders in the petroleum industry of continued engagement as the reform process unfolds, describing the measures as part of broader efforts by the Tinubu administration to ensure that Nigeria’s petroleum resources deliver measurable benefits to citizens.
