Oil and gas royalty collections by the Nigeria Revenue Service surged by N220.09bn in February 2026, a sharp increase of 87.6 per cent compared to January, following the implementation of Executive Order 9 mandating the centralisation of revenue collection in the sector.
Latest Federation Account Allocation Committee data obtained by The PUNCH on Thursday revealed that oil and gas royalties rose sharply to N471.27bn in February 2026, marking an increase of 87.6 per cent from the N251.18bn recorded in January.
The figures indicate a month-on-month increase of N220.09bn, highlighting a significant boost in government revenue from the upstream oil and gas sector within a short period.
The data, sourced from the Office of the Accountant-General of the Federation, Federation Account Department, reflects revenues generated in February but shared among the three tiers of government in March.
An analysis of the figures indicates that the N220.09bn variance represents one of the most significant month-on-month increases in oil royalty inflows in recent times, underscoring the early impact of the Federal Government’s revenue reform policy.
The sharp rise in royalty collections follows the implementation of Executive Order 9, which mandates the centralisation of oil and gas revenue collection under a unified framework coordinated by the Nigerian Revenue Service.
It also comes despite a decline in Nigeria’s crude oil production during the same period, pointing to the fact that the improved revenue came as a result of centralised collection efficiency rather than increased crude oil output.
Available industry data show that Nigeria’s average daily crude oil production dropped slightly from about 1.43 million barrels per day in January 2026 to approximately 1.41 million barrels per day in February 2026. This marginal decline reflects ongoing challenges in the sector, including pipeline vandalism, crude theft, and intermittent operational disruptions in key producing areas.
Ordinarily, a dip in production would be expected to translate into lower royalty inflows, given that royalties are largely volume-based and tied to output levels. However, the opposite was observed, as royalty collections surged by 87.6 per cent within the same period.
The development also suggests that factors such as better pricing benchmarks, improved monitoring of production volumes, and tighter reconciliation processes may have contributed to the higher revenue outturn.
This trend reinforces longstanding concerns within the industry that Nigeria’s oil and gas sector has historically suffered from revenue leakages and weak oversight, rather than purely production constraints.
With Executive Order 9 now in effect, experts believe that sustained enforcement could help Nigeria maximise earnings from existing production levels, even before achieving significant output growth.
The FAAC document further revealed that oil and gas royalties alone accounted for a substantial portion of mineral revenue for the month, reinforcing their importance to Nigeria’s fiscal stability.
In addition to royalties, the Federal Inland Revenue Service reported strong inflows from upstream petroleum taxes. Petroleum Profit Tax from oil stood at N159.99bn, while upstream Company Income Tax contributed N148.89bn, bringing the subtotal for key upstream taxes to N780.16bn.
Further breakdown showed that overall Company Income Tax collections hit N204.37bn, while other taxes contributed N118.10bn. Capital Gains Tax and stamp duties added N1.40bn and N38.45bn respectively, pushing total FIRS-related revenues to over N1.14tn for the period.
Executive Order 9 is part of a broader fiscal reform agenda by the Federal Government aimed at improving revenue assurance in Nigeria’s oil and gas sector. Historically, royalty payments and other upstream revenues were collected by multiple agencies, including regulators and tax authorities, often resulting in discrepancies, delays, and revenue leakages.
The order mandates the centralised collection of oil and gas revenues under a unified framework, with the Nigerian Revenue Service playing a coordinating role. The policy is designed to enhance transparency, ensure real-time tracking of payments, and improve remittance efficiency into the Federation Account.
There have been concerns about under-remittance and opaque accounting practices in the sector. EO9 seeks to address these issues by eliminating duplication of roles and strengthening oversight.
The latest FAAC figures suggest that the policy may already be yielding results, with February’s sharp increase in royalty collections providing early evidence of improved revenue performance.
However, analysts caution that sustaining the gains will depend on strict enforcement, stakeholder cooperation, and continued monitoring of compliance across the oil and gas value chain.
As Nigeria grapples with fiscal pressures and rising debt obligations, the success of reforms like EO9 could prove critical in boosting government revenues and stabilising the economy.
