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President Bola Tinubu has approved the cancellation of about $1.42 billion and N5.57 trillion in debts owed by the Nigerian National Petroleum Company Limited to the Federation Account, following a reconciliation of records between both parties.
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 PUNCH has reported.
According to the report, NNPC Ltd’s outstanding obligations earlier presented to FAAC stood at ““$1,480,610,652.58 and N6,332,884,316,237.13 for PSC, DSDP, RA & MCA Liftings and JV & PSC Royalty Receivables, respectively.”
However, the document disclosed that the Presidency approved that most of the balances be removed from the Federation’s books based on recommendations from the Stakeholder Alignment Committee on the reconciliation of indebtedness between NNPC Ltd and the Federation.
“However, the commission recently received a Presidential Approval to nil off the outstanding obligations of NNPC Ltd as at 31st December 2024 as submitted by the Stakeholder Alignment Committee on the Reconciliation of Indebtedness between NNPC Ltd and the Federation,” the report stated.
Providing a breakdown, the NUPRC said that out of the total outstanding sums, $1,421,727,723.00 and N5,573,895,769,388.45 were written off. It added that the appropriate accounting entries had been effected in line with the approval.
“Consequently, 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 commission has passed the appropriate accounting entries as approved.”
The figures indicate that about 96 per cent of the dollar-denominated debt and 88 per cent of the naira-denominated obligations accumulated up to December 31, 2024, were cancelled.
Despite the write-off, the regulator said new liabilities incurred by NNPC Ltd between January and October 2025 remain outstanding. These were put at “$56,808,752.32 and N1,021,550,672,578.87 for PSC & MCA Liftings and JV Royalty Receivables, respectively.”
In a separate section titled “NNPC Ltd Outstanding Obligations”, the regulator disclosed that statutory obligations arising between January and October 2025 still stood at “$56,808,752.32 and N1,021,550,672,578.87 for PSC & MCA Liftings and JV Royalty Receivables, respectively.”
The commission disclosed that part of the dollar component was recovered during the month under review. “However, the commission received $55,003,997.00 in the month under review from the outstanding, leaving a balance of $1,804,755.32 and N1,021,550,672,578.87. The amount of $55,003,997.00 received is part of the total collection reported above for sharing by the Federation this month,” the report stated.
NUPRC confirmed that the directive had already been implemented in the Federation Account, noting that “the commission has passed the appropriate accounting entries as approved,” The PUNCH reported.
