NNPC Subsidiaries’ Debt Soars to N30trn

The Nigerian National Petroleum Company (NNPC) is struggling with N30.30tn in debts owed by subsidiaries, joint ventures, and related entities, a 70.4% increase from 2023.

This is according to NNPC’s 2024 audited financial statements.

The debt surge raises concerns about liquidity management and long-term financial sustainability. Core subsidiaries like refineries and trading arms account for most of the debt, as revealed in the audited accounts.

Only 8 out of 32 subsidiaries are debt-free, with Port Harcourt Refining Company Limited owing N4.22tn, Kaduna Refining N2.39tn, and Warri Refining N2.06tn, the report showed.

NNPC Trading SA owes N19.15tn, more than double 2023’s N8.57tn. The company plans to divest non-core assets to improve liquidity, NNPC’s Group Chief Executive Officer, Bashir Bayo Ojulari, announced.

NNPC recorded N5.4tn Profit After Tax on N45.1tn revenue in 2024, up 64% and 88% respectively from 2023, according to the financial statements.

Experts say NNPC must enforce strict commercial rules and settlement timelines to address the debt issue, as quoted by The PUNCH.

Petroleum economist Prof Wumi Iledare says the debt reflects weak commercial discipline and governance issues, in a personal note reacting to The PUNCH report.

NNPC aims to restructure and attract external capital to become a profitable national oil company, the report stated.

The company’s borrowings rose to N122.8bn in 2024, funding projects like the Gwagwalada Independent Power Project, according to the audited financial statements.

The debt surge raises questions about NNPC’s transition to a commercial entity and future sustainability, analysts noted.