President Bola Ahmed Tinubu has begun preparations for a comprehensive review of the Petroleum Industry Act (PIA) after issuing an executive order mandating direct remittance of all oil and gas revenues into the Federation Account, Presidency sources said.
The PIA was enacted in 2021 to modernise Nigeria’s petroleum sector, improve governance and attract investment.
It established the legal and fiscal framework for oil and gas operations, including how revenues from Production Sharing Contracts (PSCs) are shared among the federal government, host communities and companies involved.
The executive order, signed on February 13, 2026, directs operators to remit entitlement revenues such as royalty oil, tax oil, profit oil and profit gas directly into the Federation Account rather than allowing certain deductions before remittance.
The directive is intended to align revenue flows with constitutional provisions on government revenue.
Presidency sources said the executive order represents a fiscal “reset” and that subsequent phases will include broader reforms to the PIA to address structural and fiscal concerns identified during its implementation.
Areas of focus for review include revenue architecture under PSCs and mechanisms such as the Frontier Exploration Fund and management fee arrangements, which previously allowed the Nigerian National Petroleum Company Limited (NNPC) to retain portions of revenue before remittance.
Under the post-PIA implementation framework, NNPC retained a share of profit oil and profit gas for management fees and frontier exploration before remitting the remainder to the Federation Account.
Presidency officials said this created imbalances in revenue contributions and that the order restores constitutional entitlements by requiring gross remittance before deductions.
Officials said forthcoming consultations will involve stakeholders and legislative leaders to ensure that proposed amendments to the PIA reflect constitutional and fiscal priorities while still maintaining the law’s core objectives of sector efficiency and investor confidence.
The executive order’s implementation is being overseen by a presidential committee tasked with coordinating the directive, and dialogue with the National Assembly is expected as part of the broader legislative review process.
A senior Aso Rock official said, “This executive order is the first corrective layer,” and added that where “structural defects undermine constitutional order or fiscal stability, they must be revisited.”
The official further said the directive corrects revenue imbalances pending legislative refinement and that revenue should enter the Federation Account before any allocations or deductions.
The planned PIA review follows Nigeria’s oil revenue remittance realignment and has implications for fiscal federalism, revenue transparency and the governance of Nigeria’s petroleum sector.
Direct remittance to the Federation Account is expected to strengthen federal, state and local government revenue inflows, potentially enhancing budget planning and fiscal accountability across governance tiers.
Stakeholders such as the Nigeria Extractive Industries Transparency Initiative (NEITI) have publicly supported the executive order as a step toward improved transparency in oil and gas revenue flows, and discussions on legislative amendments may further shape the petroleum sector’s regulatory environment.
