By Olusegun Obisanya
The Capital Market Academics of Nigeria (CMAN) has commended President Bola Ahmed Tinubu for what it described as a “bold and historic decision” to restore 60 per cent of proceeds from profit oil and gas under Production Sharing Contracts (PSCs) to the Federation Account, saying the move represents one of the most courageous reforms of his administration.
In a statement signed by its President, Prof. Uche Uwaleke, CMAN said the decision marked “a decisive step toward strengthening fiscal transparency and equity in revenue distribution,” while correcting what it called a long-standing anomaly in the management of Nigeria’s oil and gas revenues.
According to the group, 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 for sharing among the Federal, State and Local Governments. The remaining 60 per cent, CMAN noted, was retained by the Nigerian National Petroleum Company Limited through a 30 per cent Frontier Exploration Fund and a 30 per cent management fee, both under the company’s expenditure oversight.
“This imbalance undermined the principle of collective ownership of national resources,” the statement said. “By correcting this anomaly, the President has ensured that all tiers of government benefit equitably from the nation’s oil and gas wealth.”
CMAN further stressed that as a limited liability company, NNPCL must operate independently and sustainably on its own revenues, rather than relying on public funds. “The President’s decision is a bold move in this direction,” the academics said, adding that the reform would help align the national oil company with best practices in corporate governance and fiscal discipline.
However, the group emphasised that the reform process should not stop at PSC proceeds alone. “CMAN emphasizes that the reform process should continue, particularly with regard to Joint Venture (JV) assets, which should also be returned to the Federation Account,” the statement said, arguing that such a move would further strengthen transparency and improve revenue mobilisation across the federation.
Describing the development as a major institutional win, CMAN said the decision amounted to “a victory for the Federation Accounts Allocation Committee and for fiscal justice in Nigeria.” It added that the restoration of the 60 per cent revenue share would “significantly boost revenues available to all tiers of government,” thereby enhancing their capacity to deliver public services, stimulate economic activities and support the growth of the capital market.
The academics also reaffirmed their support for the President’s broader reform agenda, calling on all stakeholders to rally behind the policy shift. “CMAN stands firmly behind this decision and calls on all stakeholders to support the President’s reform agenda,” the statement said. “We remain committed to advocating for policies that strengthen transparency, accountability, and fairness in the management of Nigeria’s resources.”
In addition, CMAN underscored the importance of credible oversight in implementing the Executive Order backing the reform. It called for the inclusion of the Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission on the committee overseeing implementation, noting that such representation would “ensure transparency and accountability” in the process.
The group expressed optimism that sustained reforms in the oil and gas sector would translate into long-term fiscal stability and more inclusive economic development for the country.
