President Tinubu has on February 13, 2026 signed an executive order—Presidential Executive Order to Safeguard Federation Oil and Gas Revenues and Provide Regulatory Clarity, 2026—to stop excessive deductions from oil and gas revenues and ensure more money flows directly into the Federation Account for the benefit of federal, state, and local governments.
The order targets structural problems created by the 2021 Petroleum Industry Act (PIA), which the government says diverted more than two-thirds of potential oil revenue remittances through various deductions, charges, and fees.
NNPC Limited will no longer collect the 30% management fee it previously retained on profit oil and profit gas from production sharing, profit sharing, and risk service contracts. Instead, these funds will now go directly into the Federation Account.
The 30% of profit oil and profit gas from production sharing, profit sharing, and risk service contracts currently earmarked for the Frontier Exploration Fund, and hitherto retained by NNPC Limited, must now be transferred directly to the Federation Account.
All oil and gas operators and contractors under production sharing contracts must now pay royalties, oil tax, profit oil, profit gas, and all other government entitlements directly into the Federation Account, effective 13 February 2026.
Payments into the Midstream and Downstream Gas Infrastructure Fund (MDGIF) from gas flare penalties have been suspended; those proceeds will now also go to the Federation Account. Going forward, support for environmental remediation and relief for host communities impacted by gas flaring will now come from the dedicated Environmental Remediation Fund established by the Petroleum Industry Act (PIA).
The government argues that these deductions far exceed global norms and that NNPC Limited’s dual role as concessionaire (under Production Sharing Contract arrangements) and commercial entity have created competitive distortions.
The order repositions NNPC Limited strictly as a commercial enterprise, in line with the vision of the Petroleum Industry Act (PIA).
President Tinubu has announced a comprehensive review of the PIA itself will follow, in consultation with stakeholders, to address broader fiscal and structural issues.
An Implementation Committee for the Presidential Executive Order has been established, comprising key Ministers (Finance, Justice, Budget and National Planning, and Minister of State, Petroleum Resources – Oil; and including the Chairman of the Nigeria Revenue Service and the Special Adviser to the President on Energy, to oversee execution of the order.
The Special Adviser to the President on Energy shall additionally oversee a Joint Project Team that will be responsible for technical regulation of “integrated operations” (as defined by the Order), including the development of appropriate guidelines, the proposed allocation of regulatory fees, and the resolution of inter-agency issues arising from the regulation of integrated petroleum operations.
