President Bola Tinubu has approved the cancellation of significant legacy debts owed by the Nigerian National Petroleum Company Limited to the Federation Account. This move clears $1.42 billion and N5.57 trillion in outstanding obligations as of December 31, 2024.
The decision resolves long-standing disputes over NNPC's indebtedness. It stems from a thorough reconciliation process conducted by the Stakeholder Alignment Committee. The Nigerian Upstream Petroleum Regulatory Commission presented the findings at the Federation Account Allocation Committee meeting in November 2025.
Officials nullified the debts related to production sharing contracts, direct sales, joint venture royalties, and modified carry agreements.d66b35 This action covers 96% of dollar-denominated debts and 88% of naira-denominated ones.
The NUPRC document states, "The commission recently received a Presidential Approval to nil off the outstanding obligations of NNPC Ltd as at 31st December 2024.” It adds that appropriate accounting entries have been made.
Fresh debts from January to October 2025 remain intact. These total $56.81 million and N1.02 trillion. Recovery efforts continue for these amounts.
President Tinubu's approval aims to enhance transparency and efficiency in Nigeria's oil sector. It addresses challenges from the pre-Petroleum Industry Act era.
NNPC Ltd welcomes the resolution. The company affirms that all revenues due to the Federation have been accounted for properly.
This step supports ongoing economic reforms. It frees NNPC to focus on future operations and contributions to national revenue.
The Federal Government commits to strengthening oversight and reducing revenue leakages. Further updates will follow as reconciliations progress.