By Our Correspondent
The Nigerian National Petroleum Company Limited (NNPC Ltd) remitted ₦121.3 billion generated from Production Sharing Contract (PSC) profit oil to Nigeria’s Federation Account in February, marking a major shift in the country’s oil revenue management.
The remittance follows a new directive issued by President Bola Ahmed Tinubu mandating that all oil-related revenues due to the government be transferred fully into the Federation Account before any deductions are made.
Under the new order, NNPC is now required to remit 100 percent of PSC profit oil revenues directly to the national treasury. Previously, the state oil company retained a significant portion of these earnings to cover operational costs, management fees, and contributions to exploration funds before transferring the remainder to the government.
The February remittance represents a sharp increase compared to previous months. In January, the amount transferred from PSC profit oil was significantly lower because NNPC still deducted certain charges prior to remitting funds. The new directive effectively blocks such upfront deductions, ensuring that the full revenue reaches the Federation Account first.
The policy is part of the federal government’s broader effort to improve transparency, plug revenue leakages, and boost government income from Nigeria’s oil and gas sector.
By enforcing direct remittance, the administration aims to increase the funds available for distribution among federal, state, and local governments through the Federation Account Allocation Committee (FAAC).
However, the directive has sparked debate within the industry. Some analysts and stakeholders argue that removing NNPC’s ability to retain certain funds could affect financing for exploration and operational activities, particularly in frontier basins. Others believe the policy will strengthen accountability and ensure that the country derives maximum benefit from its oil resources.
The February transfer of ₦121.3 billion therefore represents not only a significant revenue inflow for the government but also the first clear sign of the financial impact of the new oil revenue policy introduced by the Tinubu administration.
