President Tinubu has signed an executive order to recover billions in oil and gas revenues lost to PIA deductions, ensuring all tiers of government receive their constitutional share.
The order, announced by Presidential spokesman Bayo Onanuga, is anchored on Section 44(3) of the Constitution, which vests ownership and control of Nigeria’s mineral resources—including oil and gas—in the Federal Government on behalf of the federation.
At the heart of the directive is a sweeping challenge to how NNPC Limited handles federation revenues. Under the current PIA framework, the national oil company retains a 30 percent management fee on profit oil and profit gas from production sharing, profit sharing, and risk service contracts—a charge the presidency now considers unjustified, given that NNPCL already retains 20 percent of its profits for working capital and future investments.
Beyond this, the company draws another 30 percent of profit from oil and gas into the Frontier Exploration Fund under sections 9(4) and (5) of the PIA—a fund the government warns risks accumulating idle cash and encouraging wasteful spending at a time of pressing national need.
The Presidency also flagged the Midstream and Downstream Gas Infrastructure Fund, which collects gas flaring penalties, noting a clear duplication since Section 103 of the PIA already establishes a dedicated Environmental Remediation Fund serving the same purpose.
Cumulatively, the government argues these deductions divert more than two-thirds of potential Federation Account remittances—a structural hemorrhage it says has driven the sustained decline in net oil revenues reaching federal, state, and local governments.
The Executive Order additionally targets what it describes as a conflict of interest in NNPC Limited’s dual role as a concessionaire under Production Sharing Contracts while simultaneously operating as a commercial entity—an arrangement the Presidency says distorts competition and contradicts the PIA’s own vision of a fully commercialized NNPC.
Tinubu framed the reforms as a matter of urgent national importance, with direct consequences for budgeting, debt sustainability, and economic stability.
WHAT YOU SHOULD KNOW
President Tinubu’s executive order cuts to the chase: NNPC Limited has been quietly siphoning off more than two-thirds of Nigeria’s oil revenues through a web of overlapping deductions under the PIA—money that should be funding schools, hospitals, and security across all tiers of government.
The order moves to shut down these leakages, eliminate duplicative funds, and strip NNPC of the structural loopholes that have allowed it to function as both referee and player in the nation’s oil economy.
Nigerians have been shortchanged by the very law designed to reform their most valuable resource, and this order is Tinubu’s attempt to reverse that.
