Tinubu plans amendments to PIA after revenue executive order, says Senate committee

PRESIDENT Bola Tinubu is set to submit proposals to the National Assembly seeking amendments to key provisions of the Petroleum Industry Act (PIA) to align the law with Nigeria’s current economic realities, the Senate Committee on Finance has revealed.

Committee Chairman, Sani Musa (Niger East), made the disclosure on Thursday during a meeting with the Economic Management Team led by Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun. NNPC

The meeting, which formed part of the discussions around the proposed 2026 budget, addressed the implications of Tinubu’s recent executive order mandating the direct remittance of oil and gas revenues into the federation account. Mr Musa noted that the directive had sparked expectations that government revenue would rise automatically.

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“Following the executive order, many assume there will be more revenue for the government. However, we are still operating within the previous system. That is why the President intends to bring the PIA forward for amendment,” Musa said. He added that revenue projections and adjustments resulting from the executive order would be factored into the 2026 fiscal framework.

The executive order

The executive order, signed on Wednesday, requires that royalties, taxes, and profit oil and gas revenues under production-sharing, profit-sharing, and risk-service contracts be paid directly into the federation account. It also eliminates the 30 percent Frontier Exploration Fund and the 30 percent management fee previously retained by the Nigerian National Petroleum Company Limited (NNPCL). The presidency said the measures, anchored in Sections 5 and 44(3) of the Constitution, are intended to protect oil and gas revenues and ensure states and local governments receive their constitutional shares.

‘Dangerous precedent’

The directive, however, has drawn criticism from some stakeholders. The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) described the order as a dangerous precedent that could weaken the PIA and deter investors. PENGASSAN President Festus Osifo called for its immediate withdrawal.

The PIA, enacted in 2021, reformed Nigeria’s oil and gas sector, including commercialising NNPCL, establishing new regulatory bodies, restructuring revenue-sharing arrangements, and introducing provisions for host community development.

Beyond the PIA amendments, the Senate committee also pressed for reforms in fiscal and administrative systems. Lawmakers advocated returning to the previous contractor payment model, which allowed Ministries, Departments, and Agencies (MDAs) to pay contractors directly, citing widespread delays under the current centralised system. They also called for replacing the envelope budgeting system with a priority- or performance-based model, arguing that the incremental allocation approach fails to promote strategic spending.

Focus on ‘ordinary citizens’

Musa stressed that economic reforms must reach ordinary Nigerians. “The envelope system has failed, encouraging routine expenditure rather than strategic prioritisation. Similarly, the centralised payment system has left many contractors unpaid. We must revert to the old method,” he said, emphasising the need for adherence to a disciplined annual budget cycle.

READ ALSO: Nigerian govt orders audit of oil revenues after Tinubu’s direct remittance order

The committee further resolved to recommend to President Tinubu the removal of Registrar-General of the Corporate Affairs Commission (CAC), Hussaini Magaji (SAN), for refusing to appear before it.

Members of the Economic Management Team assured the committee that the outlook for the proposed N58.472 trillion 2026 budget is positive. They clarified that Nigeria’s current N152 trillion debt profile largely reflects inherited obligations, exchange rate adjustments, and not only fresh borrowing, with additional borrowing since 2023 amounting to around N20 trillion.

The meeting concluded with both sides agreeing on closer collaboration between the executive and legislature to enhance budget planning, implementation, and revenue optimisation ahead of the 2026 fiscal year.