The federal government has commenced the implementation of Executive Order 9 of 2026, which mandates that oil revenues be deposited directly into the Federation Account Allocation Committee (FAAC).
Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, announced this in a statement released on Monday following a meeting of the implementation committee.
This move comes after President Bola Tinubu’s earlier directive that all funds generated from petroleum operations for the federation must be accurately accounted for and distributed in accordance with the Constitution.
The statement indicated that the committee has agreed that revenues from oil and gas operations must be managed in a manner that safeguards the interests of the federal, state, and local governments.
“In accordance with the president’s directive, NNPC Limited will immediately stop collecting the 30 percent management fee and the 30 percent frontier exploration fund deductions from profit oil and profit gas under Production Sharing Contracts.
“Furthermore, all payments of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund are to be suspended immediately, as per the Executive Order,” the statement noted.
Regarding Section 2(3) of the order, which permits contractors to make direct payments into the federation account,
Edun stated that the committee has agreed to honor existing contracts and financing arrangements to maintain investor confidence.
“As a result, the committee has approved a specified transition period for the implementation of direct payments by contractors for profit oil, royalty oil, and tax oil into the federation account.
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“Until the committee provides detailed guidelines, contractors will continue to remit payments using the current process.
“During the transition period, the Committee will issue clear, standardized instructions to ensure a smooth transition,” the statement added.
The minister also mentioned that a technical subcommittee has been established to develop detailed guidelines within three weeks.
This team will also review aspects of the Petroleum Industry Act to address structural and financial issues impacting federation revenues.
He noted that the sub-committee will be led by the special adviser to the president on energy and will include key government officials from the justice ministry, revenue service, and finance commissioners’ forum.
Meanwhile, the Budget Office of the Federation will provide secretarial assistance.
Edun emphasized that the committee will continue to provide updates as the process progresses and expressed gratitude to stakeholders for their collaboration in ensuring that oil resources benefit Nigerians nationwide.
