The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Bola Tinubu to withdraw and review his recent Executive Order directing the remittance of oil and gas revenues to the Federation Account, warning that the policy could destabilise the industry and threaten thousands of jobs.
Speaking at a media briefing in Lagos on Friday, PENGASSAN President, Festus Usifo, said the Order was based on inaccurate briefings and sends a wrong signal to investors at a time Nigeria is seeking fresh capital for the energy sector.
While acknowledging the President’s constitutional powers to issue Executive Orders, Usifo argued that such directives cannot override existing laws, particularly provisions of the Petroleum Industry Act (PIA) 2021. He maintained that sections of the PIA clearly define revenue flows and warned that any attempt to set aside the Act by executive fiat could erode international confidence in Nigeria’s legal and regulatory framework.
According to PENGASSAN, claims in the Order suggesting that 30 per cent of Production Sharing Contract proceeds and Frontier Exploration Funds accrue directly to the Nigerian National Petroleum Company Limited (NNPC Limited) are misleading. Usifo said the actual benefits to NNPC Ltd are far lower and that such funds are paid into designated accounts in line with the law, not into the company’s coffers.
The union further warned that if the directive remains, about 4,000 NNPC Ltd employees could face redundancy as the company may struggle to meet its financial obligations, potentially triggering industrial relations crises across the sector. Beyond labour concerns, Usifo cautioned that declining oil and gas investment would weaken foreign exchange earnings, worsen pressure on the naira, and ultimately erode workers’ purchasing power.
Describing the Executive Order as a broader threat to economic stability, PENGASSAN urged the President to recall and review the policy to avoid undermining the gains recorded since the PIA came into force in August 2021. The union said it would intensify engagement with government and stakeholders, with further actions to be determined by its National Executive Council if concerns are not addressed.
However, the Capital Market Academics of Nigeria (Capital Market Academics of Nigeria) (CMAN) has praised the President’s directive, describing it as a bold and courageous reform aimed at strengthening fiscal transparency and equity in revenue sharing.
CMAN President, Uche Uwaleke, in a statement issued in Abuja, said the Order would boost revenues available to federal, state and local governments, enhance service delivery, stimulate economic activities and deepen the capital market. He argued that since the implementation of the PIA in 2021, only about 40 per cent of oil and gas proceeds reached the Federation Account, with the balance retained through management fees and the Frontier Exploration Fund.
Uwaleke described the reform as a victory for fiscal justice and called for further measures, including the return of Joint Venture asset revenues to the Federation Account. He also urged that the Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission be included in the committee overseeing the Order’s implementation to ensure transparency and accountability.
President Tinubu had, on February 18, issued the Executive Order as part of efforts to curb revenue leakages, eliminate duplicative structures and reposition NNPC Ltd strictly as a commercial entity. According to a statement by his spokesperson, Bayo Onanuga, the directive seeks to restore constitutional revenue entitlements of the three tiers of government and address fiscal challenges affecting national budgeting, debt sustainability and economic stability. The President also pledged a comprehensive review of the PIA in consultation with stakeholders.
