The Capital Market Academics of Nigeria (CMAN) has welcomed a new executive order by Bola Ahmed Tinubu requiring oil and gas revenues to be paid directly into Nigeria’s Federation Account.
The group described the move as a “bold and historic” reform aimed at improving transparency and fairness in how oil income is shared among federal, state and local governments.
Under the order, 60% of proceeds from profit oil and gas under Production Sharing Contracts (PSCs) will now be returned to the Federation Account. Since the introduction of the Petroleum Industry Act in 2021, only 40% of PSC proceeds had been paid into the account, with the remaining 60% retained by the Nigerian National Petroleum Company Limited (NNPCL) for management fees and the Frontier Exploration Fund.
Speaking to local media, CMAN President Uche Uwaleke said the previous arrangement reduced the funds available to state and local governments and weakened the principle that oil resources belong collectively to all Nigerians.
“With this Executive Order, the President has restored balance and fairness to Nigeria’s oil revenue framework,” the group said in a statement. It added that the decision would increase statutory allocations to subnational governments, improve public service delivery and boost investor confidence.
CMAN also argued that, as a limited liability company, NNPCL should operate independently on revenues it generates, rather than retaining funds that should go into the Federation Account.
However, while praising the reform, the academics urged the government to extend the policy to Joint Venture (JV) assets in the oil and gas sector. They said revenues from JV operations should also be paid directly into the Federation Account to ensure full transparency and prevent preferential retention of public funds.
The group further called for strong oversight of the implementation process. It recommended that the chairman of the Revenue Mobilisation, Allocation and Fiscal Commission be included in the committee overseeing the reform to strengthen credibility and public confidence.
Describing the measure as one of the most significant fiscal decisions of the current administration, CMAN said sustained reforms in the oil and gas sector were essential to improving Nigeria’s public finances and supporting long-term economic growth.
