Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn — that is the headline projection after President Bola Ahmed Tinubu directed that key oil and gas revenues be paid directly into the Federation Account, tightening the screws on long-criticised deductions and off-the-top retentions that have shrunk what FAAC ultimately shares.
The projection—about ₦14.57 trillion (and in some calculations ₦14.72 trillion)—is based on 2025 revenue inflow patterns submitted to the Federation Account Allocation Committee (FAAC), and reflects the size of revenue streams that could now flow more transparently into the pool shared by the federal, state and local governments. 
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn is tied to a broad reform move that also affects the Nigerian National Petroleum Company Limited (NNPC), regulators, and specific sector funds created under the Petroleum Industry Act (PIA).
What the executive order changes
At the centre of the policy is a directive that royalty oil, tax oil, profit oil, profit gas, and other government interests under production sharing, profit sharing and risk service contracts be paid straight into the Federation Account. 
This is significant because, since the PIA era, large deductions and retentions have happened before FAAC sees the money. Reuters reported that the presidency said these deductions had reduced net oil inflows and worsened fiscal strain across the three tiers of government. 
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn also targets two controversial items widely discussed in the oil sector:
1. The 30% Frontier Exploration Fund (FEF)
2. The 30% management fee on profit oil and profit gas retained by NNPC under certain contract frameworks
Punch reported that under the post-2021 arrangement, the Federation Account effectively received about 40% of proceeds from some Production Sharing Contract (PSC) streams, while the remaining 60% was retained by NNPC—split between the Frontier Exploration Fund and management fee. 
Under the new directive, NNPC is no longer to collect and manage the Frontier Exploration Fund and is no longer entitled to the 30% management fee on profit oil/profit gas that should flow to the Federation Account. 
Where the “₦15tn” estimate is coming from
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn is not a random figure. Punch’s analysis of 2025 FAAC earnings suggests the order affects several major revenue streams, including:
• NNPC management fees + Frontier Exploration Fund deductions: about ₦906.91bn (₦453.455bn each in 2025) 
• Oil and gas royalties: ₦7.55tn (previously collected/retained via the upstream regulator framework) 
• Gas flaring penalties: ₦611.42bn 
• Petroleum Profits Tax + Hydrocarbon Tax: ₦4.905tn (2025) 
• Midstream and Downstream Gas Infrastructure Fund (MDGIF): ₦596.61bn (2025) 
Add them up, and you land around ₦14.57tn, with Punch also noting a cumulative total around ₦14.72tn depending on inflow dynamics. 
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn is therefore best understood as a revenue redirection estimate based on past inflows—not a guaranteed lump sum that will show up overnight.
https://ogelenews.ng/tinubus-executive-order-fg-states-lgs-allocation
What happens to agencies and sector funds
The executive order also reworks how certain agencies and sector funds operate.
Premium Times reported the order is framed as restoring constitutional revenue entitlements that the presidency says were reduced through PIA-era channels, with the order issued under constitutional authority and anchored on federal control over minerals and natural resources. 
It also changes what happens to gas flare penalty proceeds, directing them into the Federation Account rather than the MDGIF pipeline. The Cable reported the presidency said payments into the MDGIF from gas flare penalties are suspended under the directive, with spending to follow procurement rules. 
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn also signals a shift to appropriation-based funding and management fees, instead of automatic deductions that reduce what FAAC shares—Reuters highlighted that NNPC would instead receive a government-appropriated management fee. 
Why this matters for states and local governments
For governors and council chairmen, the biggest question is simple: will FAAC receipts rise meaningfully?
Punch reported implementation had commenced and may reflect in allocations around the next FAAC meeting window, meaning states and LGs could begin seeing effects if remittances follow the new pipeline. 
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn could also reduce the long-running “FAAC tension” where states complain that crude sales are rising but net distributable revenue remains weak due to deductions.
But it also creates a new pressure point: if more money comes in, citizens will expect more results, and fiscal discipline becomes the real test—BusinessDay’s coverage noted the harder question is whether governments will spend increased inflows wisely. 
What to watch next
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn will rise or fall on three practical issues:
1. Compliance and remittance discipline across NNPC, operators, and regulators
2. Legal harmonisation with PIA provisions—including how grey areas are resolved 
3. Transparency at FAAC: whether the “new inflows” show clearly in distributable revenue and published summaries
Bottom line
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn is a major fiscal intervention aimed at forcing oil and gas revenues into the Federation Account with fewer leakages and fewer automatic deductions.
If the remittance pathway holds, the three tiers of government stand to receive stronger monthly allocations. If it stalls in implementation—or collides with legal and institutional resistance—the “₦15tn” projection will remain more headline than reality.
Tinubu’s Executive Order: FG, states, LGs allocation may increase by N15tn is now a policy test case: not of announcement, but of execution.
https://punchng.com/tinubus-executive-order-fg-states-lgs-allocation-may-increase-by-n15tn
