By Erewunmi Peace

The Federal Government has begun the direct remittance of oil and gas revenues into the Federation Account, the central pool from which the Federation Account Allocation Committee (FAAC) distributes funds to federal, state, and local governments.

The move comes after President Bola Ahmed Tinubu signed Executive Order 9, which aims to strengthen fiscal transparency and reduce revenue leakages in the management of Nigeria’s oil resources.

Key Details

All royalties, taxes, profit oil, and profit gas are now to be remitted directly into the Federation Account, rather than being processed through intermediary channels.

The policy is intended to enhance accountability and ensure that allocations to states and local governments are timely and traceable.

Analysts note that this may reduce deductions that previously occurred during intermediary handling by oil companies or the Nigerian National Petroleum Company (NNPC).

Why This Matters

The direct remittance system is expected to:
Improve the flow of oil revenues to FAAC for equitable distribution.
Minimize opportunities for mismanagement or diversion of funds.

Reinforce constitutional principles on public finance management.

Officials say the policy is part of a broader push for financial transparency and better fiscal federalism, ensuring that all oil revenues contribute directly to national development and shared resources.