In a major policy move aimed at tightening government control over oil and gas revenues, Bola Ahmed Tinubu has announced the signing of Executive Order 9 of 2026.
The directive seeks to stop multiple deductions and overlapping charges in the petroleum sector and ensure that government earnings are paid straight into the Federation Account for the benefit of Nigeria.
According to the President, the reform is designed to protect public funds, restore confidence in the management of national resources, and enforce full compliance.
All government benefits from oil and gas activities, including royalty oil, tax oil, profit oil, profit gas, and other earnings from production sharing and associated contracts, must now be deposited straight into the Federation Account in accordance with the new presidential order.
This marks a clear shift away from a system where revenues were previously subjected to several layers of deductions and retention mechanisms before reaching the central account shared by the federal, state, and local governments.
A key change announced in the order is the removal of two major deductions:
(i) The additional 30 percent management fee
(ii) The deduction of 30% for Frontier Exploration
(iii) The government contends that these fees led to structural distortions in the oil and gas industry's income structure and undermined inflows intended for national development.
The President further declared that, in accordance with current legislation, NNPC Limited will now only conduct business as a commercial organization.
This means the national oil company is expected to focus on business operations rather than acting as a gatekeeper for government revenue collections.
In addition, the administration has approved the creation of an Implementation Committee to coordinate and monitor the rollout of the order across relevant institutions. A broader review of the Petroleum Industry Act is also planned to address what the government describes as fiscal and structural anomalies.
From a policy standpoint, the order represents an effort to address long-standing flaws in the oil and gas industry as well as greater central control over revenue flows. However, how well agencies comply and how open the implementation process is will determine its actual impact.
While the reform promises improved accountability, industry observers will be watching closely to see whether operational efficiency and investor confidence are maintained during the transition.
Frequently Asked Questions
1. What exactly does Executive Order 9 of 2026 change?
It mandates that all government revenues from petroleum production and related contracts must be paid directly into the Federation Account without intermediate deductions.
2. What are the deductions that are being eliminated?
the 30 percent deduction for Frontier Exploration and the additional 30 percent management charge.
3. What function does NNPC Limited provide in this order?
It is anticipated that NNPC Limited will cease acting as a conduit for the retention or deduction of government funds and instead function only as a commercial enterprise.
4. Will this affect state and local governments?
Yes. Since the Federation Account is shared among federal, state, and local governments, faster and fuller inflows could improve their revenue allocations.
5. Is this enough to fix Nigeria’s oil revenue problems?
Not by itself. The order improves the flow of funds, but long-term success will still depend on enforcement, institutional discipline, transparency, and reforms to sector governance.
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