President Tinubu deserves credit for reforming Petroleum Industry Act — Adio

Waziri Adio, founder and executive director of Abuja-based public policy think tank, Agora Policy, has commended Bola Tinubu for taking steps to address perceived shortcomings in the Petroleum Industry Act (PIA), while calling for further reforms to strengthen the law.

Tinubu recently signed an executive order directing the direct remittance of oil and gas revenues to the federation account. The order mandates that the 30 per cent management fee and the 30 per cent frontier exploration fund be paid straight into the federation account, a move aimed at improving transparency and accountability in the sector.

Adio, a former executive secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), described the development as a necessary corrective measure. He noted that although the PIA remains a landmark reform and a major legacy of former President Muhammadu Buhari, certain provisions created structural imbalances that required urgent attention.

“It is a miracle that some of the defects of the PIA were allowed to stand for this long: they are at odds with the constitution, the highest law of the land, and they unduly favour the national oil company, NNPC Limited, at the expense of its owner, the Federation,” Adio stated.

He argued that the law did little to resolve the long-standing principal-agent concerns between the federation and NNPC Limited, and in some respects deepened them by granting the oil firm additional advantages.

Adio urged the administration to remain consistent in its reform efforts, warning against any attempt to reclassify the scrapped management fee as operational costs.

He also welcomed the president’s pledge to undertake a comprehensive review of the PIA and to confine the national oil company strictly to its commercial mandate.

According to him, beginning with an executive order was a strategic move, as a direct legislative amendment could have proved contentious given the financial implications. He expressed optimism that subsequent reform steps would be easier now that the president has made his position clear.