The Federal Government has launched a comprehensive forensic audit of past revenue collections by key agencies in the oil and gas sector, including the Nigerian National Petroleum Company Limited (NNPCL) and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The investigation, which will also cover the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and other operators, is designed to recover any outstanding sums due to the Federation following President Bola Tinubu’s recent Executive Order mandating the direct remittance of all oil and gas revenues into the Federation Account.
According to a document signed by the Minister of State for Finance and Chairman of the Federation Account Allocation Committee (FAAC), Dr. Doris Uzoka-Anite, the Federal Government has directed all relevant institutions to cease all forms of deductions and off-budget retentions from petroleum revenues with immediate effect.
The letter, titled: ‘Implementation of Presidential Executive Order on Safeguarding Federation Oil and Gas Revenues and Providing Regulatory Clarity – Immediate Remittance Directive and Retrospective Audit’, reinforces the constitutional provisions of Section 162, requiring that all revenues accruing to the Federation be paid in full without any deductions.
“I write to request that all revenues accruing to the Federation must be paid into the Federation Account without deduction.Accordingly, the following directives take immediate effect: Immediate cessation of deductions and retention. All institutions and operators are hereby directed to cease collection and management of the 30 per cent allocation to the Frontier Exploration Fund (FEF); suspend payment and retention of the 30% management fee on profit oil and profit gas revenues previously payable to NNPC Limited”, the Minister stated.
The directive also includes the cessation of payments of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund (MDGIF), and a discontinuation of all forms of off-budget allocations and administrative deductions inconsistent with the Executive Order.
All profit oil, profit gas, royalty oil, tax oil, gas flare penalties, and any other petroleum-related revenue streams are now to be remitted directly into a designated Sub-Federation Account, to be managed by the Office of the Accountant-General of the Federation pending FAAC distribution. The minister emphasised that no institution shall retain, net off, or deduct funds before remittance.
All affected entities, including NNPC Limited, NUPRC, NMDPRA, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), the Nigeria Revenue Service (NRS), and oil contractors, have been mandated to provide full financial records, documentation, and unrestricted access to audit teams.
The Government warned that any breach of this directive will be treated as a violation of a lawful Executive Order and constitutional fiscal provisions. It said weekly remittance reports must now be submitted to the office of the Minister of State for Finance.
