Oil and gas royalty collections in Nigeria recorded a dramatic rise in February 2026, following the enforcement of Executive Order 9, which centralised revenue collection in the sector. Data from the Federation Account Allocation Committee (FAAC) showed royalties climbed to N471.27 billion, an increase of N220.09 billion compared to January’s N251.18 billion. This represents an 87.6 percent month-on-month surge, one of the most significant jumps in recent years.
The figures, sourced from the Office of the Accountant-General of the Federation, reflect revenues generated in February but distributed among federal, state, and local governments in March. Analysts view the sharp increase as early evidence of the Federal Government’s fiscal reforms beginning to yield results.
Executive Order 9 mandates that all oil and gas revenues be collected under a unified framework coordinated by the Nigeria Revenue Service. Previously, multiple agencies handled collections, often leading to discrepancies, delays, and leakages. By consolidating the process, the government aims to improve transparency, ensure real-time tracking, and strengthen oversight.
The February revenue surge highlights the efficiency gains from centralisation. Despite a slight decline in crude oil production, royalties rose sharply, suggesting that improved monitoring and reconciliation processes played a decisive role.
Industry data revealed that Nigeria’s average daily crude oil output fell from 1.43 million barrels per day in January to about 1.41 million barrels per day in February. Ordinarily, lower production would reduce royalty inflows, since royalties are volume-based. However, the opposite occurred.
This paradox points to structural issues in the sector. For years, Nigeria’s oil revenues have been undermined by weak oversight, under-remittance, and opaque accounting practices. The February outcome suggests that better pricing benchmarks, tighter monitoring, and reduced leakages are now boosting collections, even without higher production.
FAAC data showed that oil and gas royalties accounted for a substantial share of mineral revenues in February. In addition to royalties, the Federal Inland Revenue Service (FIRS) reported strong inflows from upstream petroleum taxes.
– Petroleum Profit Tax: N159.99 billion
– Upstream Company Income Tax: N148.89 billion
– Combined upstream taxes: N780.16 billion
Beyond the upstream sector, overall Company Income Tax collections reached N204.37 billion. Other taxes contributed N118.10 billion, while Capital Gains Tax and stamp duties added N1.40 billion and N38.45 billion respectively. In total, FIRS-related revenues exceeded N1.14 trillion for the period.
Executive Order 9 is part of a broader fiscal reform agenda aimed at strengthening Nigeria’s revenue assurance framework. By eliminating duplication of roles and centralising collections, the government seeks to close gaps that have historically drained public finances.
The oil and gas sector remains Nigeria’s most critical revenue source. February’s figures underscore the importance of royalties and upstream taxes in stabilising fiscal flows. With debt obligations rising and fiscal pressures mounting, reforms like EO9 are seen as vital to sustaining government finances.
While the February surge is encouraging, experts caution that sustaining the gains will require strict enforcement and cooperation across the oil and gas value chain. Persistent challenges such as pipeline vandalism, crude theft, and operational disruptions continue to weigh on production. Without addressing these issues, Nigeria may struggle to achieve long-term revenue growth.
Analysts also warn that transparency must remain central to the reform. Improved monitoring and reconciliation processes must be consistently applied to prevent a return to under-remittance and leakages.
The sharp rise in royalties demonstrates that Nigeria can maximise earnings from existing production levels through better governance. It also reinforces the argument that revenue challenges in the sector have often stemmed more from inefficiency than from output constraints.
If sustained, the reforms could help Nigeria strengthen fiscal stability, reduce reliance on borrowing, and create room for investment in infrastructure and social programs. The February outcome provides a strong case for continuing the centralisation policy and expanding its scope to other revenue streams.
Nigeria’s oil and gas royalties surged by N220.09 billion in February 2026, marking an 87.6 percent increase from January. The rise, achieved despite lower crude production, highlights the impact of Executive Order 9 and the benefits of centralised revenue collection.
The figures suggest that improved oversight and reduced leakages are already reshaping fiscal outcomes. However, sustaining these gains will depend on consistent enforcement, stakeholder cooperation, and continued transparency. As Nigeria faces economic pressures, reforms like EO9 could prove decisive in stabilising revenues and strengthening the nation’s financial resilience.
