The Federal Government has approved a transition period for oil contractors to begin making direct payments into the Federation Account, in line with Executive Order 9 of 2026 issued by President Bola Ahmed Tinubu.
The move is aimed at strengthening petroleum revenue management and safeguarding public funds.
The decision was reached at the inaugural meeting of the Implementation Committee for Executive Order 9 held on February 26, 2026.
In a statement issued Monday, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, who chairs the committee, said the transition period would ensure the new system is introduced without disrupting existing contractual and financing arrangements in the oil sector.
Executive Order 9 directs that revenues from petroleum operations—including profit oil, royalty oil and tax oil—be paid directly into the Federation Account to improve transparency and strengthen the finances of the three tiers of government.
Edun said the committee agreed that the shift must be carefully managed to maintain investor confidence while protecting Nigeria’s revenue base.
“This transition must be implemented in a manner that respects existing contractual and financing arrangements and maintains investor confidence,” he said.
He explained that contractors will continue to remit payments under the current process until detailed operational guidelines are issued.
To facilitate the transition, the committee approved the creation of a technical subcommittee tasked with developing the implementation framework within three weeks.
The subcommittee, to be led by the Special Adviser to the President on Energy, Olu Verheijen, will also review the Petroleum Industry Act to address structural and fiscal issues affecting revenues accruing to the Federation.
According to Edun, the review will examine provisions that may weaken government earnings from petroleum operations.
The technical team will include senior officials from the Ministry of Justice, the Nigeria Revenue Service, the Forum of Commissioners of Finance, and the office of the Minister of State for Petroleum Resources, while the Budget Office of the Federation will serve as secretariat.
The committee reiterated that the reform is intended to ensure that oil and gas revenues are properly accounted for and remitted in line with constitutional provisions.
As part of the new measures, the government has directed NNPC Limited to immediately halt the collection of a 30 percent management fee and a 30 percent frontier exploration fund deduction from profit oil and gas under Production Sharing Contracts.
In addition, remittances of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund have been suspended with immediate effect.
The implementation committee said it will continue to issue updates as the reform progresses, noting that the policy forms part of the President’s broader efforts to ensure Nigeria’s petroleum resources deliver measurable benefits to citizens.