President Bola Tinubu has signed an Executive Order suspending the collection of management and frontier exploration fees by the Nigerian National Petroleum Company Limited, in a major step to safeguard oil and gas revenues due to the Federation.
The directive mandates the direct remittance of taxes, royalties and profit oil under Production Sharing Contracts to the appropriate fiscal authorities, effectively ending deductions at source.
According to the Federal Ministry of Finance, the Order realigns revenue flows with the 1999 Constitution of the Federal Republic of Nigeria, which requires that all revenues from mineral resources be paid into the Federation Account.
The Order also halts payments of gas flare penalties into the Midstream Gas Infrastructure Fund and clarifies regulatory roles between the Nigerian Upstream Petroleum Regulatory Commission and the Nigerian Midstream and Downstream Petroleum Regulatory Authority.
An inter-agency committee chaired by Finance Minister Wale Edun will oversee implementation.
The Presidency described the measure as urgent, citing sustained declines in oil revenue inflows despite improved production and favourable market conditions. The Order serves as an interim corrective step pending amendments to the Petroleum Industry Act 2021, which previously allowed 30 per cent deductions for management fees and another 30 per cent for frontier exploration.
The move signals tighter federal control over oil revenue administration and could significantly reshape NNPC’s funding structure under the PIA framework.
