NNPC Cancels FG’s N4.01trn Subsidy Arrears, Other Debts

The Nigerian National Petroleum Company Limited (NNPC) has cancelled subsidy arrears and other debts owed by the Federal Government totalling N4.01tn, following a reconciliation of accounts between both parties.

According to documents submitted by NNPC to the Federal Allocation Accounts Committee (FAAC), the debt write-off was part of an agreement approving the cancellation of a substantial portion of outstanding liabilities by the government.

“The NNPC Ltd Payables to Federation amounted to N4,716,488,337,458.65 as at October 2025 FAAC. The NNPC LTD payables to the Federation are N706,317,894,682.09 as at November 2025 FAAC,” the report noted.

President Bola Tinubu had approved the cancellation of a substantial portion of the debts owed by NNPC to the Federation Account, wiping off about $1.42bn and N5.57tn after a reconciliation of records between both parties.

The debts earlier reported at the October 2025 FAAC meeting stood at “$1,480,610,652.58 and N6,332,884,316,237.13 for PSC, DSDP, RA & MCA Liftings and JV & PSC Royalty Receivables respectively.”

The amount forgiven by NNPC represents the difference between its payables to the Federation as at the October 2025 FAAC meeting and the revised figure presented at the November 2025 meeting.

FAAC records showed that NNPC’s payables to the Federation stood at N4.72tn as at October 2025.

However, by the November 2025 FAAC meeting, the outstanding amount had dropped sharply to N706.32bn, implying a cancellation of N4.01tn.

“The outstandings for the period up to May 2023 for Royalty, Tax, & 40% PSC Profit due to Federation were included in the Presidential Approved Stakeholder Alignment Committee,” the report added.

The documents indicated that the forgiven sum was lower than earlier subsidy arrears figures. The discrepancy between figures earlier cited by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and those presented by NNPC was also clarified in the documents submitted to FAAC.

According to the records, the total equivalent outstanding liabilities in naira stood at N4.72tn, while the grand total outstanding amounted to N6.75tn.

The documents explained that the variation arose largely from how certain legacy obligations were treated.

The NUPRC confirmed that it had already implemented the directive, noting that “the Commission has passed the appropriate accounting entries as approved.”

The approval effectively resolves long-running disputes over NNPC’s legacy indebtedness to the Federation, while current liabilities from ongoing operations continue to be tracked for future recovery.