Tinubu Ends NNPC’s 30% Oil, Gas Cuts, Orders Direct Payment to Federation Account

Bola Tinubu has signed an executive order abolishing the 30 per cent management fee previously retained by Nigerian National Petroleum Company Limited on profit oil and profit gas revenues. The directive mandates that the funds be paid directly into the Federation Account with immediate effect.

A statement issued by the Presidency and signed by Special Adviser on Information and Strategy, Bayo Onanuga, said the measure is aimed at strengthening federal revenue flows, cutting waste and removing duplicative cost layers in the oil and gas sector. The President invoked his constitutional powers under Section 5 of the 1999 Constitution (as amended) in signing the order.

The directive draws authority from Section 44(3) of the Constitution, which assigns ownership and control of minerals, mineral oils and natural gas to the Federal Government. Under the existing framework of the Petroleum Industry Act, NNPC Limited had been retaining 30 per cent of revenue from Production Sharing Contracts, Profit Sharing Contracts and Risk Service Contracts as a management fee, in addition to 20 per cent of its profits for operational costs and future investments.

According to the gazetted order, operators and contractors handling oil and gas assets under production sharing arrangements must now remit Royalty Oil, Tax Oil, Profit Oil, Profit Gas and all other government entitlements straight to the Federation Account from February 13, 2026. The Presidency said an implementation committee has been constituted to oversee compliance, while a broader review of the Petroleum Industry Act will be undertaken to address fiscal and structural concerns in the sector.