According to the latest report from the Federation Accounts Allocation Committee (FAAC), the Nigerian National Petroleum Company Limited (NNPCL) owes a total of N6.57 trillion in unremitted royalties and taxes to the Federal Government.
The report, delivered at the May 2025 FAAC meeting, details liabilities amounting to N3.89 trillion in unpaid royalties owed to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and an additional N2.52 trillion in tax arrears due to the Federal Inland Revenue Service (FIRS).
A report from FAAC, titled "NNPC Ltd Payables to NUPRC, FIRS & Federation as of May 2025 FAAC," was reviewed by our correspondent on Friday. The document highlights the persistent fiscal challenges in Nigeria's oil sector, where revenue leakages continue despite reform efforts.
The debts accumulated from June 2023 to April 2025 also comprise N162.33 billion in withheld dividends.
Earlier this year, the World Bank criticized NNPCL's financial practices, highlighting that the company remitted only N600 billion out of N1.1 trillion in crude oil revenues for 2024, with the remaining amount used to settle previous obligations.
The World Bank reported that although the subsidy was entirely removed in October 2024, NNPCL did not begin transferring the revenue gains to the Federation until January 2025. Since initiating transfers, only half of these gains have been remitted, with the remainder being used to settle past arrears.
The report indicated that while agencies such as FIRS, NCS, and NUPRC experienced an increase in revenue collections in 2024, the contributions from NNPCL dropped significantly—from N1.1 trillion in 2023 to just N600 billion in 2024—mainly due to ongoing impacts of subsidies.
A monthly analysis showed fluctuating remittances. Royalties peaked at N321.99 billion in September 2023 but fell to N127.32 billion by May 2024. The most significant monthly deficit occurred in August 2023, exceeding N770 billion.
Tax debts exhibited a similar trend. In October 2023, the monthly liability reached its highest point at N173.9 billion, before decreasing to N34.2 billion in January 2024. By April, there was a rebound with arrears climbing back up to N122.2 billion.
Between July and December 2023, the NUPRC's royalty debts rose from N133.96 billion to N178.47 billion, whereas FIRS arrears decreased from N173 billion to N81.8 billion. By March of the first quarter in 2024, royalties had climbed once more, reaching a total of N229.49 billion.
By April 2025, NNPCL was still shouldering substantial obligations, with monthly royalty dues exceeding N130 billion and tax debts surpassing N64 billion. This indicates that remittances are not yet fully settled.
In 2023, the total debt reached N2.03 trillion, overseen by the Office of the Accountant General. Between January 2024 and April 2025, an extra N4.537 trillion was incurred. Additionally, there was a documented carryover balance of N107.67 billion.
The monthly data from January to December 2024 displayed consistent fluctuations: starting at N208.57 billion in January, experiencing a significant increase to N532.07 billion by March, and then declining slightly to N277.41 billion in April. The year concluded with unsettled payments amounting to N449.36 billion in December.
In early 2025, remittance values remained elevated at N197.05 billion in January, N234.83 billion in February, and N204.74 billion in April.
The FAAC report stated that the Office of the Accountant General is responsible for accounting a total of N2.03 trillion, which includes royalties amounting to N1.19 trillion and taxes totaling N843.28 billion from June to December 2023.
It also verified that partial payments will occur in 2025: "After discussions between NNPCL's leadership and the Minister of Finance, who is also the Coordinating Minister of the Economy and Chairman of FAAC, NNPC Limited paid 50% of JV Royalty & Taxes for February through May 2025 to FAAC."
In light of these revelations, NNPCL claimed that there was a coordinated effort to undermine its leadership and disrupt its reform agenda.
"The Nigerian National Petroleum Company Limited announced on Friday morning that it has discovered a developing sabotage campaign orchestrated by a syndicate of both known and anonymous individuals, operating from outside as well as within different levels of the organization."
The company claimed that a deliberate misinformation campaign was being conducted to distract its executives and deceive the public.
This group is deliberately spreading falsehoods and misinformation to undermine NNPC Ltd.'s leadership and hinder the organization's ongoing transformation into a corruption-free, performance-oriented energy company, in accordance with the mandate of His Excellency, the President of Nigeria.
NNPCL chose not to name any individuals but emphasized its dedication to continuing reforms, even in the face of resistance from within and outside the organization.
The organization publicly defended itself following an investigation by the Senate Committee on Public Accounts, which identified financial discrepancies amounting to over N210 trillion in audits conducted between 2017 and 2023.
Executives of NNPCL did not attend the committee meeting, leading to a 10-day ultimatum requiring them to appear by July 10 or face constitutional consequences.
The Senate pointed out questionable entries, such as N103 trillion recorded as accrued expenses and an additional N103 trillion categorized under receivables. Both lacked supporting documentation.
"These are deliberate actions by individuals who perceive reform, transparency, accountability, and change as threats—demonstrating the extent they will go to impede the transformation of Nigeria's leading energy institution," claimed the company.
"We anticipate an increase in defamatory content in the coming days and weeks. NNPC Ltd. remains resolute, as our transformation is already in progress and will not be hindered by any acts of sabotage," it stated.
Confirming its support for President Tinubu's emphasis on accountability in the oil industry, NNPCL concluded,
We encourage our committed staff, stakeholders, and all patriotic Nigerians to stay determined, disregard any distractions, and remain undeterred. Our mission continues unchanged.
Post a Comment