The Capital Market Academics of Nigeria (CMAN) has commended President Bola Ahmed Tinubu for approving the direct remittance of 60 per cent of proceeds from profit oil and gas under Production Sharing Contracts (PSCs) to the Federation Account.
In a statement signed by its President, Prof. Uche Uwaleke, the group described the move as one of the most courageous reforms of the administration and a significant step toward strengthening fiscal transparency and equity in revenue distribution.
CMAN noted that since the implementation of the Petroleum Industry Act (PIA) in 2021, the Federation Account—shared by the federal, state and local governments—received only 40 per cent of proceeds from profit oil and gas under PSCs. The remaining 60 per cent was retained by the Nigerian National Petroleum Company Limited (NNPCL), comprising 30 per cent allocated to the Frontier Exploration Fund and 30 per cent as management fee.
According to CMAN, the arrangement created an imbalance that undermined the principle of collective ownership of the nation’s natural resources.
The group said the President’s decision to restore 60 per cent of the proceeds to the Federation Account corrects the anomaly and ensures more equitable distribution of oil and gas revenues across all tiers of government.
The academics further argued that as a limited liability company, NNPCL should operate independently using its own revenues rather than relying on public funds.
They described the Executive Order as a bold move in that direction but urged the government to extend the reform to Joint Venture (JV) assets, recommending that such assets also be returned to the Federation Account.
CMAN described the development as a victory for the Federation Accounts Allocation Committee (FAAC) and for fiscal justice in Nigeria, adding that the increased revenue inflow would enhance the capacity of federal, state and local governments to deliver public services, stimulate economic activities and deepen the capital market.
The group also called for the inclusion of the Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) in the committee overseeing implementation of the Executive Order to strengthen transparency and accountability.
CMAN reaffirmed its support for the President’s reform agenda and pledged continued advocacy for policies that promote transparency, accountability and fairness in the management of Nigeria’s resources.
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