President Bola Tinubu has approved the cancellation of a substantial portion of the debts owed by the Nigerian National Petroleum Company Limited (NNPCL) to the Federation Account, wiping off about $1.42 billion and N5.57 trillion. This decision follows a reconciliation of records between NNPCL and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The debts, which were reported at the October 2025 Federation Account Allocation Committee (FAAC) meeting, stood at $1,480,610,652.58 and N6,332,884,316,237.13 for Production Sharing Contracts (PSC), Direct Sale Direct Purchase (DSDP), Royalty Agreements (RA), and Modified Carry Agreements (MCA) liftings, as well as Joint Venture (JV) and PSC royalty receivables.
The NUPRC confirmed that the Presidency has approved the removal of most of these balances from the Federation’s books. However, fresh debts built up in 2025 remain, with statutory obligations arising between January and October 2025 standing at $56,808,752.32 and N1,021,550,672,578.87 for PSC & MCA liftings and JV royalty receivables, respectively.
The debt cancellation is part of efforts to improve accountability in the management of public finances and close loopholes in remittances by revenue-generating agencies ¹
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