The Director-General of the Budget Office of the Federation, Tanimu Yakubu has defended Executive Order 9 (EO9), insisting that the directive signed by President Bola Tinubu does not amount to executive lawmaking but rather enforces constitutional provisions governing Federation revenues.
In a statement dated 23 February 2026, Yakubu, described criticisms of the Order as a misinterpretation of both the 1999 Constitution (as amended) and the fiscal issues at stake. According to him, EO9 does not create new law but operationalises existing constitutional mandates on revenue custody and remittance.
EO9 specifically targets the oil and gas sector, directing the direct remittance of petroleum revenues—including royalties, taxes, profit oil and gas, penalties, and related receipts—into constitutionally recognised accounts. The Order also tightens reconciliation and transparency mechanisms across revenue collection, custody, and reporting processes.
The Order introduces sweeping reforms to revenue management within the petroleum sector. Under the new framework, the Nigerian National Petroleum Company Limited (NNPC) will no longer collect and manage the 30 per cent Frontier Exploration Fund derived from profit oil and profit gas under production and profit-sharing contracts.
Additionally, the company’s entitlement to a 30 per cent management fee on profit oil and gas revenues has been withdrawn. All such funds are now to be paid directly into the Federation Account.
According to the statement by Yakubu, “Commentary suggesting that Executive Order 9 (EO9) amounts to the President ‘making law’ misstates both the Constitution and the fiscal question at issue. EO9 does not create law; it enforces constitutional custody of Federation revenues.
“Section 80(1) of the Constitution (1999, as amended) is mandatory: all revenues or other moneys raised or received by the Federation shall be paid into and form one Consolidated Revenue Fund of the Federation. Public revenue cannot lawfully be retained, applied, or warehoused outside constitutional funds.
“Section 162 complements this rule by requiring revenues accruing to the Federation to be paid into the Federation Account for distribution in accordance with constitutional allocation principles. The order of legality is clear: revenue must first enter constitutionally recognised accounts before it can be appropriated, shared, or spent.
“EO9 operationalises these provisions in the oil and gas sector by directing direct remittance of petroleum revenues – including royalties, taxes, profit oil and gas, penalties, and related receipts – into constitutionally recognised accounts, and by tightening reconciliation and transparency across collection, custody, and reporting.
“EO9 does not intrude into legislative competence. Section 60(1) preserves the procedural autonomy of the National Assembly; EO9 does not regulate legislative procedure, amend the Petroleum Industry Act (PIA), or repeal any statute. It is an executive instrument issued under Section 5 to ensure faithful execution of the Constitution and applicable laws.
“If any party disputes the constitutional validity of EO9, the judiciary remains the proper forum for determination. Pending any judicial pronouncement, the Executive is duty-bound to protect Federation revenues, uphold constitutional supremacy, and strengthen fiscal integrity for FAAC distributions, budget credibility, and macroeconomic stability.”
Effective February 13, 2026, oil and gas operators holding assets under production sharing contracts must remit Royalty Oil, Tax Oil, Profit Oil, Profit Gas, and other government entitlements directly to the Federation Account. Payments of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund (MDGIF) have also been suspended, with such proceeds redirected to the Federation Account.
The administration argues that existing deductions under the PIA—including NNPC’s 20 per cent retention for working capital and future investments, alongside the additional 30 per cent management fee and frontier exploration allocation—exceed global norms and significantly reduce remittances available for distribution to federal, state, and local governments.
President Tinubu described the reforms as urgent and necessary to restore fiscal integrity, strengthen FAAC distributions, enhance budget credibility, and promote macroeconomic stability. He also signalled plans for a comprehensive review of the Petroleum Industry Act in consultation with stakeholders to address identified fiscal and structural concerns.
To oversee implementation, an inter-ministerial committee has been established, comprising key officials including the Minister of Finance, the Attorney-General of the Federation, the Minister of Budget and National Planning, and the Minister of State for Petroleum Resources (Oil), among others. The Director-General of the Budget Office will serve as secretary to the committee.
The Executive Order has been formally gazetted, with the government maintaining that any constitutional challenge should be resolved through the judiciary while the Executive continues to uphold what it describes as constitutional supremacy and fiscal accountability.
Melissa Enoch
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