By Obinna Uballa
Fresh controversy has erupted in the oil and gas sector following the executive order signed by President Bola Tinubu mandating the direct remittance of oil and gas revenues to the Federation Account Allocation Committee (FAAC), with the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) calling for its immediate withdrawal.
The New Diplomat had reported that directive, signed on February 18, effectively removes the Nigerian National Petroleum Company (NNPC) Limited’s oil revenue deduction powers by requiring that royalty oil, tax oil, profit oil and profit gas be paid directly into the federation account.
Addressing journalists on Thursday, a visibly upset PENGASSAN National President, Festus Osifo, described the move as a violation of the Petroleum Industry Act (PIA), warning that it could destabilise the legal and fiscal framework governing the sector.
According to Osifo, specific provisions of the PIA, including Sections 8, 9 and 64, clearly define NNPC Limited’s powers and operational structure, and cannot be altered through an executive order.
“Executive orders cannot override the law of the land. What has been done is a direct attack on the PIA,” he said, urging the president to rescind the directive and review its implications.
Osifo acknowledged the president’s constitutional authority to issue executive orders but argued that such powers must not conflict with existing legislation passed by the National Assembly. He warned that overriding statutory provisions through executive instruments could weaken investor confidence in Nigeria’s oil and gas industry.
“At a time when the government is seeking to attract local and international investment, this kind of signal is troubling,” he said, adding that investors may begin to question the stability of fiscal terms and regulatory protections under the PIA.
The PENGASSAN leader further suggested that the president may not have been fully briefed on the potential consequences of the order. He noted Tinubu’s prior experience in the oil sector, including his background at ExxonMobil, and expressed belief that a more detailed review could have led to a different decision.
Osifo also raised concerns about the operational impact on NNPC Limited, warning that the order could affect the company’s ability to meet financial obligations, including commitments to workers.
“If this is not properly addressed, our members could be exposed to uncertainty, and that is something we cannot ignore,” he said.
