…Transfer Allegedly Executed Without Official Explanation
…Stakeholders Demand Forensic Audit Of Frontier Exploration Account
Fresh controversy has enveloped the management of Nigeria’s Frontier Exploration Fund following allegations that $279m was secretly transferred from the fund’s account without the approval of the designated signatories, prompting calls for a comprehensive forensic investigation into the transaction.
The allegations have placed the Executive Chairman of the Nigeria Revenue Service, Zacch Adedeji, under scrutiny, with stakeholders demanding explanations over the circumstances surrounding the movement of the funds and whether due process was observed.
According to the allegations, the transfer was executed without the authorization or signatures of the officials designated to approve transactions from the Frontier Exploration Fund account.
It was further alleged that no official explanation has been provided regarding the destination of the funds, the legal authority for the transfer or the beneficiaries of the transaction.
The claims have triggered concerns among stakeholders in the oil and gas industry, who argued that if established, such a transaction would raise serious questions about financial governance, transparency and compliance with the Petroleum Industry Act (PIA) 2021, which created the fund and stipulates how it should be managed.
Consequently, they are calling on anti-corruption agencies, the National Assembly and other oversight institutions to undertake an independent forensic audit of the account to determine whether the transaction complied with existing laws and financial regulations.
The stakeholders also want investigators to establish who authorized the transfer, where the money was moved to, whether the funds were subsequently utilised for purposes permitted under the law and whether any public official violated financial management procedures.
The Frontier Exploration Fund is one of the major innovations introduced under Section 9 of the Petroleum Industry Act (PIA), 2021.
The fund was created to finance petroleum exploration in frontier basins where commercially viable hydrocarbon deposits have not yet been fully established.
The objective is to expand Nigeria’s proven oil and gas reserves by supporting geological mapping, seismic surveys, exploratory drilling, appraisal wells, basin studies and other exploration activities considered necessary to unlock hydrocarbon resources in underexplored areas.
Nigeria’s designated frontier basins include the Chad Basin, Sokoto Basin, Bida Basin, Benue Trough, Anambra Basin and Dahomey Basin.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) also has the statutory authority to designate additional frontier basins where exploration activities may be undertaken.
To ensure sustainable funding for the programme, the PIA provides that 30 per cent of NNPC Limited’s profit oil and profit gas generated from Production Sharing Contracts (PSCs), Profit Sharing Contracts and Risk Service Contracts shall be paid into the Frontier Exploration Fund.
The law requires NNPC Limited to remit the money into a dedicated Frontier Exploration Fund Escrow Account within 21 days after the end of every quarter.
Administration of the fund rests with the NUPRC, which is responsible for establishing and managing the escrow account, approving exploration programmes, monitoring utilisation of the funds and ensuring that the resources are deployed strictly for frontier exploration activities in accordance with the provisions of the PIA.
Since its creation, however, the Frontier Exploration Fund has remained one of the most debated aspects of the Petroleum Industry Act.
Supporters argued that Nigeria must continue exploring new basins to replace depleting reserves in the Niger Delta and maintain its long-term position as a leading oil and gas producer.
They contend that without sustained investment in frontier exploration, the country’s reserve replacement ratio could decline, threatening future production and government revenues.
Critics, on the other hand, have questioned the decision to allocate as much as 30 per cent of NNPC Limited’s profit oil and profit gas to high-risk exploration projects, arguing that the money could be better utilised for infrastructure development, healthcare, education or distributed through the Federation Account for the benefit of all tiers of government.
Oil-producing states have also consistently argued that the funding arrangement reduces revenues available for statutory allocation, while some industry experts have questioned whether frontier exploration should continue to receive significant public funding at a time when the global energy transition is accelerating investment away from fossil fuels.
The debate intensified in 2026 after President Bola Tinubu signed Executive Order 9, directing that revenues previously earmarked for the Frontier Exploration Fund should instead be paid into the Federation Account pending broader fiscal reforms.
The directive immediately generated legal and policy debates over whether an executive order could validly suspend or alter a funding mechanism expressly established by an Act of the National Assembly without legislative amendment.
It is against this backdrop that the latest allegations concerning the alleged $279m transfer have attracted widespread attention.
Stakeholders insist that irrespective of the ongoing policy debate surrounding the future of the Frontier Exploration Fund, every transaction involving the account must comply with the provisions of the law, established financial control procedures and internationally accepted standards of public financial management.
They argue that any movement of public funds without appropriate authorization, if proven, would undermine public confidence in the management of petroleum revenues and weaken transparency in one of the country’s most strategic sectors.
Accordingly, they are urging relevant oversight institutions to conduct a detailed forensic examination of the transaction, publish their findings and hold accountable any individual or institution found to have breached the law.
They also called on the Federal Government to provide a comprehensive explanation regarding the allegations in order to reassure Nigerians and investors that the management of petroleum revenues remains transparent and subject to strict accountability mechanisms.
ENDS
(The Whistler)