CMAN Lauds Tinubu’s Oil Revenue Order, Seeks Extension To JV Assets

The Capital Market Academics of Nigeria (CMAN) has commended President Bola Tinubu for issuing an Executive Order mandating the direct remittance of oil and gas revenues to the Federation Account, describing the move as a bold and historic fiscal reform that restores transparency and equity in Nigeria’s revenue-sharing framework.

The President of CMAN, Prof. Uche Uwaleke, told THE WHISTLER that the decision to return 60 per cent of proceeds from profit oil and gas under Production Sharing Contracts (PSCs) to the Federation Account corrects a long-standing imbalance that had disadvantaged subnational governments and weakened the principle of collective ownership of national resources.

He recalled that since the implementation of the Petroleum Industry Act (PIA) in 2021, only 40 per cent of PSC proceeds had been paid into the Federation Account shared by the Federal, State and Local Governments.

The remaining 60 per cent was retained by the Nigerian National Petroleum Company Limited through the Frontier Exploration Fund and management fees.

According to the academics, this structure constrained fiscal space for governments at all levels and undermined equitable revenue distribution.

“With this Executive Order, the President has demonstrated uncommon courage by restoring balance and fairness to Nigeria’s oil revenue framework,” CMAN said. “The reform ensures that proceeds from the nation’s oil and gas wealth are shared equitably among all tiers of government, thereby strengthening fiscal transparency and accountability.”

The group further argued that as a limited liability company, NNPCL should operate independently on revenues it generates, rather than relying on funds that ought to accrue to the Federation Account.

The CMAN President described Tinubu’s decision as a critical step toward aligning the company’s operations with global best practices for national oil companies.

Beyond the immediate gains, CMAN noted that the policy shift would significantly boost statutory allocations to states and local governments, enhancing their capacity to deliver public services, stimulate economic activity, and support capital market development.

The group added that improved liquidity at the subnational level could also strengthen infrastructure spending and deepen investor confidence.

Describing the development as a victory for fiscal justice, CMAN said the reform would reinforce the work of the Federation Accounts Allocation Committee by ensuring that all eligible revenues are transparently pooled and distributed in line with constitutional provisions.

However, while applauding the Executive Order, the CMAN President urged the Federal Government to extend the reform to Joint Venture (JV) assets in the oil and gas sector.

According to the group, revenues from JV operations should also be returned to the Federation Account to fully entrench transparency and end all forms of preferential retention of public funds.

“While the Executive Order is commendable, the reform process should not stop at PSCs,” CMAN said. “For Nigeria to achieve comprehensive fiscal transparency in the oil and gas sector, revenues from Joint Venture assets should equally be remitted directly to the Federation Account.”

The academics also underscored the importance of strong oversight in implementing the Executive Order.

In this regard, CMAN called for the inclusion of the Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) on the committee overseeing implementation, noting that such representation would enhance credibility, transparency and public confidence in the process.

CMAN reaffirmed its support for President Tinubu’s broader reform agenda, describing the oil revenue decision as one of the most consequential fiscal interventions of the current administration.

The group urged all stakeholders, including regulators, industry operators and civil society organisations, to support the policy and ensure full compliance.

“We remain committed to advocating policies that promote transparency, accountability and fairness in the management of Nigeria’s resources,” CMAN said, adding that sustained reforms in the oil and gas sector are essential to strengthening public finances, boosting investor confidence and unlocking long-term economic growth.