FG Sets Transition Plan for Direct Oil Revenue Payments to Federation Account
The Federal Government has commenced the implementation of Executive Order 9 of 2026, mandating the direct remittance of oil revenues to the Federation Account Allocation Committee (FAAC). The development follows the inaugural meeting of the implementation committee held on February 26, 2026. Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed this in a statement on Monday, outlining key resolutions reached at the meeting. According to him, the committee reaffirmed the directive of President Bola Tinubu that all revenues accruing to the federation from petroleum operations must be managed in line with constitutional provisions, safeguard national earnings, and support fiscal stability across the three tiers of government. Read Also: A Quiet War on Our Soil: How Aid, Chemicals, and Banditry Are Strangling Northern Nigeria’s Ginger Heartland As part of the reforms, the government directed the NNPC Limited to immediately discontinue the collection of 30 percent management fees and 30 percent frontier exploration fund deductions from profit oil and gas under Production Sharing Contracts (PSCs). The statement also announced the immediate suspension of remittances of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund, in compliance with the executive order. On the provision for direct payments by contractors into the federation account, Edun explained that the committee approved a structured transition period to ensure the process aligns with existing contractual obligations and maintains investor confidence. “Until detailed guidelines are issued, contractors will continue with the current remittance process,” he said, adding that standardised procedures would be introduced to ensure a seamless transition. To facilitate implementation, the committee approved the establishment of a technical subcommittee tasked with developing comprehensive transition guidelines within three weeks. The subcommittee will also commence a review of the Petroleum Industry Act (PIA) to address structural and fiscal gaps affecting federation revenues. The subcommittee, to be led by the Special Adviser to the President on Energy, will include key stakeholders such as the Solicitor-General of the Federation, the Permanent Secretary of the Federal Ministry of Justice, the Chairman of the Nigeria Revenue Service, and representatives from the Ministry of Petroleum Resources and the Budget Office of the Federation. Edun noted that the committee would continue to provide coordinated guidance and updates as implementation progresses, while commending stakeholders for their cooperation in advancing reforms aimed at ensuring Nigeria’s petroleum resources deliver tangible benefits to citizens.
















