In a significant move to address lingering financial disputes, President Bola Tinubu has approved the cancellation of extensive debts owed by the Nigerian National Petroleum Company (NNPC) to the Federation Account. This decision eliminates approximately $1.42 billion and N5.57 trillion in liabilities, following a meticulous reconciliation of accounts between NNPC and relevant governmental bodies.
According to a report from the Nigerian Upstream Petroleum Regulatory Commission, the total debts had initially been reported at around $1.48 billion and N6.33 trillion. With the presidential directive, approximately 96% of the dollar-denominated and 88% of the naira-denominated debts have been removed from the Federation’s records. This cancellation represents a crucial step in resolving the longstanding issues related to NNPC’s legacy debts while still acknowledging that new debts from current operations continue to accumulate.
However, the NUPRC disclosed that fresh obligations incurred in 2025 remain substantial, totaling over $1 billion in dollar liabilities and more than N1 trillion in naira. These ongoing debts highlight the importance of maintaining rigorous accountability for current financial operations, even as historical disputes are addressed. While the commission managed to recover some obligations in recent months, challenges persist regarding revenue projections and actual collections.
The reports indicate a significant decline in royalty payments from oil and gas, which are critical to the country’s revenue stream. For November 2025, the NUPRC noted a drastic shortfall in projected collections, raising alarms about the fiscal health of the sector. With an approved revenue target of over N13 trillion for the year, actual collections were only about half of this amount, spotlighting issues of fiscal management and transparency within NNPC’s operations.
