The Federal Government has officially initiated the implementation of Executive Order 9 of 2026, establishing a new mandate for the direct remittance of oil revenues to the Federation Account Allocation Committee (FAAC). This decision follows the inaugural meeting of the implementation committee, which took place on February 26, and aims to fortify the nation’s economic framework.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, conveyed important resolutions from the meeting, underscoring the government’s commitment to ensuring that oil revenues align with constitutional principles and bolster the fiscal stability of Nigeria’s three tiers of government. He announced that the Nigerian National Petroleum Corporation (NNPC) Limited will immediately halt the collection of both the 30% management fee and frontier exploration deductions from profit oil and gas under Production Sharing Contracts (PSCs).
In a move geared towards fiscal accountability, Edun explained that all gas flare penalties will be suspended, redirecting focus to direct payments from contractors into the federation account. This is in accordance with Section 2(3) of the executive order that mandates these changes while maintaining investor confidence and honoring existing contracts.
To facilitate this transition, a defined period has been approved by the committee. During this time, contractors will continue to remit revenues as per the existing procedures until comprehensive guidelines are issued. The committee aims to ensure a seamless shift towards direct payments, alleviating potential disruptions in revenue flow.
The implementation committee plans to establish a technical subcommittee to formulate detailed transition guidelines over the next three weeks. It will also conduct a review of the Petroleum Industry Act (PIA) to address structural shortcomings affecting revenue generation. The subcommittee will include experts from various sectors, ensuring a well-rounded approach to the reform process.
