Dalena Reporters l December 29, 2025
The Federal Government of Nigeria, under President Bola Tinubu, has approved the write-off of the bulk of longstanding legacy debts owed by the Nigerian National Petroleum Company Ltd. (NNPCL) to the Federation Account, clearing the majority of pre-2025 obligations that had been a source of contention in federal revenue planning. The decision follows a reconciliation exercise by a stakeholder committee on NNPC’s indebtedness, which reviewed debts accumulated up to December 31, 2024 and submitted recommendations for resolution.
Prior to the adjustment, reported outstanding legacy obligations stood at roughly $1.48 billion and N6.33 trillion, tied to crude oil liftings, production-sharing contracts, royalty arrangements and other historical revenue claims. Nigeria’s President approved the cancellation of about $1.42 billion and N5.57 trillion of those debts, representing the majority of the previously reported liabilities and effectively clearing them from the Federation’s books.
The write-off was implemented through appropriate accounting entries in the Federation Account following approval, aiming to resolve long-running disputes over revenue obligations between NNPC Ltd and government agencies. Government officials noted that liabilities incurred during 2025 remain on the books and are being monitored for recovery as part of ongoing revenue management.
This accounting move addresses one of the historical flashpoints in Nigeria’s fiscal landscape, where unresolved NNPC debts had complicated intergovernmental revenue allocations and planning. While it brings clarity to past disputed figures, the decision also places emphasis on addressing the company’s current statutory obligations and improving transparency in future oil revenue remittances.