President Bola Tinubu has given the green light for the cancellation of a significant amount of the Nigerian National Petroleum Company Limited (NNPCL)’s debts owed to the Federation Account, effectively erasing around $1.42 billion in legacy debts.
This information is detailed in a document from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which was presented during the November 2025 Federation Account Allocation Committee (FAAC) meeting.
The decision reportedly came after recommendations from the Stakeholder Alignment Committee regarding the reconciliation of debts between NNPC Ltd and the Federation.
The debt write-off pertains to legacy obligations up until December 31, 2024, which include Production Sharing Contracts (PSC), Domestic Supply obligations, repayment agreements, modified carry arrangements, and joint venture/PSC royalty receivables.
This decision was made following suggestions from the Stakeholder Alignment Committee and reconciliation efforts by the NUPRC, with the necessary accounting adjustments already reflected in the Federation Account.
While the majority of past debts have been settled, newer obligations for 2025 (from January to October) are still outstanding and are currently being monitored and recovered.
Additionally, a separate, ongoing dispute regarding an alleged under-remittance of $42.37 billion from 2011 to 2017 remains unresolved, with NNPC Ltd denying the claims and asserting that all revenues were accurately reported, as disclosed in the NUPRC document.