FG Writes Off $1.42bn, N5.57tn NNPC Debt With Tinubu’s Approval

The Federal Government has approved the cancellation of a significant portion of debts owed by the Nigerian National Petroleum Company Limited (NNPC Ltd) to the Federation Account, amounting to about $1.

The development 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,” detailed the outcome of the reconciliation process.

In the section titled “Recovery from NNPC Ltd Outstanding Obligations,” the commission stated that debts earlier reported at the October 2025 FAAC meeting stood at $1,480,610,652.58 and N6,332,884,316,237.13, relating to Production Sharing Contracts (PSC), Direct Sale Direct Purchase (DSDP), Royalty and Miscellaneous Crude Account (MCA) liftings, as well as Joint Venture (JV) and PSC royalty receivables.
According to the document, the Presidency approved that most of these balances be removed from the Federation’s records.
The report stated:
“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.”
Providing a breakdown, the NUPRC explained that out of the total outstanding balances, $1,421,727,723.00 and N5,573,895,769,388.45 were written off. The commission confirmed that the appropriate accounting entries had been effected in line with the approval.
A review of the figures indicates that the presidential directive cleared about 96 per cent of the dollar-denominated debt and approximately 88 per cent of the naira-denominated obligations previously recorded as outstanding.
The document further revealed that the approval followed the recommendations of the Stakeholder Alignment Committee on the Reconciliation of Indebtedness between NNPC Ltd and the Federation, which examined the company’s royalty and lifting-related liabilities up to December 31, 2024.
In another section titled “NNPC Ltd Outstanding Obligations,” the regulator disclosed that statutory obligations incurred between January and October 2025 remained at $56,808,752.32 and N1,021,550,672,578.87, covering PSC and MCA liftings, as well as JV royalty receivables.
The commission noted that part of the dollar-denominated obligation had been recovered during the period under review, stating:
“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 NUPRC confirmed that the directive had already been implemented in the Federation Account, adding that the commission had passed the required accounting entries as approved.
The approval effectively settles long-standing disputes over NNPC Ltd’s legacy debts to the Federation, while outstanding liabilities arising from current operations will continue to be monitored for future recovery.