The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), has claimed that President Bola Tinubu was misled by his advisors to sign the recent executive order on the nation’s oil and gas sector.
The union picked holes in the order,which it said is injurious to the survival of the country’s oil and gas industry.
President Bola Tinubu, had on Wednesday issued an executive order directing the restructuring of oil and gas revenue remittances to the Federation Account and removing the 30 percent management fee previously retained by the Nigerian National Petroleum Company Limited, NNPCL, on oil and gas profits.
He also directed the direct remittance of royalty oil, tax oil, and profit oil to the Federation Account.
His spokesman,Bayo Onanuga, who conveyed this in a statement, explained that the development is aimed at enhancing transparency, reducing discretionary retention of funds, and strengthening statutory transfers to the three tiers of government.
At a press conference on Thursday, President of PENGASSAN, Comrade Festus Osifo, clarified that though the President has constitutional powers to issue executive orders, such powers must not override existing laws, especially the Petroleum Industry Act (PIA) in the country.
“We strongly believe that in this particular case, Mr. President has been misled. The people advising him did not present the full picture. The President we know is travelling across the world to attract investment into Nigeria. If he had been exposed to the entire truth, he would have acted differently.” he said.
The union participated in public hearings and engaged principal officers of the National Assembly to ensure the legislation would stabilise the industry, incentivise investment, and provide regulatory certainty, he also said.
Lamenting that before the enactment of the Petroleum Industry Act, investment in Nigeria’s oil and gas sector had declined sharply for nearly a decade due to regulatory uncertainty with significant drop in rig counts, Osifo hinted that:“when the PIA came, we began to see investments trickling back. But recent developments, especially this executive order, are sending troubling signals to investors.”
According to him, the executive order directly conflicts with Sections 8, 9 and 64 of the Petroleum Industry Act, insisting that an executive directive cannot supercede an Act of the National Assembly.
He cautioned that such actions could erode investor confidence and portray Nigeria as a country where laws can be set aside at will.
He emphasized that safeguarding regulatory certainty is critical to protecting employment, growing union membership, and ensuring long-term sustainability of the country’s oil and gas industry.
He sought urgent review of the executive order and renewed stakeholder consultations with a view to preventing further uncertainty in the industry.
Also commenting, a petroleum economist, Prof Wunmi Iledare , warned that certain aspects of the Executive Order intersect directly with provisions of the Petroleum Industry Act (PIA) 2021.
The statutory constructs such as the Frontier Exploration Fund, the Midstream and Downstream Gas Infrastructure Fund, and existing Production Sharing Contract (PSC) fiscal structures, he said, were established by the National Assembly and may require legislative amendment if substantive changes are to be made.
“While executive authority under Section 5 of the Constitution empowers the President to implement and enforce laws, substantive alterations to statutory fiscal frameworks may require legislative amendment to ensure constitutional alignment and institutional certainty,” he stated.
He emphasised the need to clearly distinguish between contractual revenue allocations embedded in PSC agreements, corporate retained earnings of Nigerian National Petroleum Company Limited, and statutory earmarked funds created under the PIA.
According to him, clarity in these distinctions is critical to avoid conflating contractual entitlements with discretionary fiscal practices.
Speaking on the direct remittance of royalty oil, tax oil, and profit oil to the Federation Account, he maintained that while the policy could enhance transparency and reduce intermediation, its implementation must be carefully sequenced to preserve contractual stability and prevent unintended legal or investor confidence challenges.