The Federation Account received 100 percent of profit oil from production sharing contracts (PSCs) in February 2026, following the implementation of President Bola Tinubu’s Executive Order 9, which mandates that all government oil revenues be paid directly into the federation account.
Figures from the Nigerian National Petroleum Company Limited presented to the Federation Account Allocation Committee (FAAC) and seen by TheCable show that NNPC remitted ₦121.34 billion as PSC profit oil in February, a sharp increase from the ₦16.07 billion recorded in January. This brings the year-to-date PSC remittance to ₦137.41 billion. Previously, the federation had received only 40 percent of PSC profit oil, with NNPC retaining portions under the Petroleum Industry Act.
Executive Order 9, signed on February 18, 2026, effectively ended NNPC’s powers to deduct oil and gas revenues, ensuring that royalty oil, tax oil, profit oil, profit gas, and other government entitlements are paid directly into the federation account.
Despite the increase in February inflows, overall remittances remain below budget. The NNPC had budgeted ₦394.73 billion PSC revenue for the first two months of the year, leaving a shortfall of about ₦257.32 billion. Additionally, no interim dividend was received from NNPC for January and February, despite a projected ₦542.37 billion, resulting in total oil and gas revenue falling well short of the ₦937.10 billion budgeted.
Meanwhile, the FAAC meeting in March 2026, chaired by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, approved a total distributable revenue of ₦1.894 trillion for February. Of this amount, the Federal Government received ₦675.088 billion, the 36 state governments shared ₦651.525 billion, and the 774 local government councils received ₦456.467 billion.
The breakdown of statutory revenue totaling ₦1.274 trillion showed the Federal Government received ₦613.174 billion, states ₦311.010 billion, and local councils ₦239.776 billion. Oil-producing states also received ₦110.949 billion as derivation revenue. From the ₦619.119 billion VAT revenue, the Federal Government got ₦61.912 billion, state governments ₦340.515 billion, and local councils ₦216.692 billion.
FAAC data revealed that while oil and gas royalty and excise duty performed well, revenues from Petroleum Profit Tax, Hydrocarbon Tax, Companies Income Tax, Capital Gains Tax, Stamp Duties, and VAT recorded declines. Import duty and the Common External Tariff also saw slight increases.
The February FAAC distribution reflects a shift in Nigeria’s fiscal landscape, with full PSC profit oil remittance marking a key step in government revenue reform under EO9, while overall revenue performance highlights ongoing challenges in meeting budget projections.
FAAC meets monthly to allocate revenues in line with Nigeria’s revenue-sharing formula, balancing resources among the Federal Government, states, and local councils.