TINUBU APPROVES WRITE-OFF OF $1.42BN, N5.57TN NNPC DEBT TO FEDERATION ACCOUNT
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By Aishat Momoh. O.
President Bola Tinubu has approved the cancellation of a significant portion of the outstanding debts owed by the Nigerian National Petroleum Company Limited (NNPC Ltd) to the Federation Account, wiping off about $1.42 billion and N5.57 trillion following a reconciliation of records.
The approval is contained in a document prepared by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and presented at the November meeting of the Federation Account Allocation Committee (FAAC). The report, titled “Report of October 2025 Revenue Collection Presented at the Federation Account Allocation Committee Meeting Held on 18th November 2025,” was obtained on Sunday.
According to the document, NNPC Ltd’s outstanding obligations earlier reported at the October 2025 FAAC meeting stood at $1.48 billion and N6.33 trillion, covering Production Sharing Contracts (PSC), Direct Sale Direct Purchase (DSDP), Royalty Adjustment (RA), Modified Carry Arrangement (MCA) liftings, and Joint Venture (JV) and PSC royalty receivables.
However, the commission disclosed that the Presidency approved the removal of most of the balances from the Federation’s books following the recommendations of the Stakeholder Alignment Committee on the Reconciliation of Indebtedness between NNPC Ltd and the Federation.
“Out of $1,480,610,652.58 and N6,332,884,316,237.13, the affected outstanding obligations that have been nil off are $1,421,727,723.00 and N5,573,895,769,388.45,” the report stated, adding that appropriate accounting entries had been effected.
An analysis of the figures shows that about 96 per cent of the dollar-denominated debt and 88 per cent of the naira-denominated obligations were written off. The directive covers legacy liabilities up to December 31, 2024.
Despite the debt relief, the NUPRC noted that fresh statutory obligations accumulated by NNPC Ltd in 2025 remain outstanding. These liabilities, covering January to October 2025, stood at $56.81 million and N1.02 trillion. The commission disclosed that $55 million of the dollar component was recovered during the review month, leaving a balance of $1.8 million, while the naira component remains unpaid.
The regulator confirmed that the recovered funds formed part of the revenue shared by the Federation for the month.
The debt cancellation comes amid challenges in meeting revenue targets. Data from the report showed that against an approved monthly revenue target of N1.204 trillion for November 2025, actual collections stood at N660.04 billion, leaving a shortfall of N544.76 billion. Royalty collections were particularly affected, with N605.26 billion realised against a target of N1.144 trillion.
Cumulatively, as of November 30, 2025, the NUPRC recorded N7.60 trillion in actual revenue collections against an approved target of N13.25 trillion, resulting in a gap of N5.65 trillion.
Meanwhile, long-standing disputes over alleged under-remittance of oil revenues persist. NNPC Ltd is currently at odds with Periscope Consulting, an audit firm engaged by the Nigeria Governors’ Forum, over claims that $42.37 billion was under-remitted to the Federation Account between 2011 and insists.
While NNPC Ltd insists that all revenues due to the Federation were fully accounted for during the period, Periscope Consulting maintains that substantial gaps remain unresolved. The FAAC Sub-Committee has directed both parties to hold a joint reconciliation meeting to harmonise records and conclude the matter.
Experts have described the controversy as a legacy issue stemming from weaknesses in Nigeria’s pre–Petroleum Industry Act framework, while international bodies such as the World Bank have continued to raise concerns over transparency and remittances by the national oil company.
NNPC Ltd’s Group Chief Executive Officer, Bayo Ojulari, has repeatedly pledged to strengthen transparency, accountability, and compliance in the company’s operations, assuring stakeholders that its dealings with the Federation Account would align with fiscal rules.
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