NNPCL yet to remit over N6.5trn in taxes, royalties -FAAC

The Nigerian National Petroleum Company Limited (NNPCL) owes the Federal Government a combined total of N6.57 trillion in unremitted royalties and taxes, according to the latest disclosure from the Federation Accounts Allocation Committee (FAAC).

The report, presented during the May 2025 FAAC meeting, breaks down the liability into N3.89 trillion in unpaid royalties to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and another N2.52 trillion in tax arrears to the Federal Inland Revenue Service (FIRS).

FAAC’s report, titled “NNPC Ltd Payables to NUPRC, FIRS & Federation as at May 2025 FAAC”, was accessed by our correspondent on Friday. It underscores ongoing fiscal challenges in Nigeria’s oil sector, with revenue leakages persisting despite reform initiatives.

The debts, accrued between June 2023 and April 2025, also include N162.33 billion in withheld dividends.

Earlier this year, the World Bank had criticized NNPCL’s financial practices, revealing the firm remitted just N600 billion from N1.1 trillion in crude oil revenues in 2024, with the balance used to clear prior obligations.

“Despite the subsidy being fully removed in October 2024, NNPCL started transferring the revenue gains to the Federation only in January 2025. Since then, it has been remitting only 50 per cent of these gains, using the rest to offset past arrears,” the World Bank stated.

The report showed that while agencies like FIRS, NCS, and NUPRC saw an upsurge in revenue collections in 2024, NNPCL’s contributions declined sharply—from N1.1 trillion in 2023 to N600 billion in 2024—primarily due to lingering subsidy impacts.

Month-by-month analysis revealed inconsistent remittances. Royalties reached N321.99 billion in September 2023 before dropping to N127.32 billion by May 2024. The largest shortfall in a single month was recorded in August 2023, totaling over N770 billion.

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Tax debts followed a similar pattern. October 2023 saw the highest monthly liability at N173.9 billion, which dropped to N34.2 billion in January 2024. April marked a resurgence, with arrears peaking at N122.2 billion.

From July to December 2023, NUPRC royalty debts increased from N133.96 billion to N178.47 billion, while FIRS arrears declined from N173 billion to N81.8 billion. By the first quarter of 2024, royalties again surged, reaching N229.49 billion in March.

As of April 2025, NNPCL continued to carry significant obligations, with royalty dues remaining above N130 billion monthly and tax debts above N64 billion, suggesting that remittances are still far from complete.

The total debt recorded in 2023 stood at N2.03 trillion, with the Office of the Accountant General designated to manage those figures. An additional N4.537 trillion was added between January 2024 and April 2025. A carryover balance of N107.67 billion was also documented.

Monthly figures from January to December 2024 showed steady fluctuations: N208.57 billion in January, a sharp rise to N532.07 billion in March, and a slight dip to N277.41 billion in April. December ended the year with N449.36 billion in unsettled payments.

In early 2025, remittance values continued to hover at high levels—N197.05 billion in January, N234.83 billion in February, and N204.74 billion in April.

The FAAC report noted that, “The sum of N2.03tn comprising royalty of N1.19tn and Tax of N843.28bn from June to Dec 2023 is to be accounted for by the Office of the Accountant General.”

It also confirmed partial payments in 2025: “Following the engagement between the Leadership of NNPCL and the Minister of Finance and Coordinating Minister of the Economy/Chairman of FAAC, NNPC Limited remitted the 50 per cent JV Royalty & Taxes in February, March & April and May 2025 FAAC.”

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Amidst these revelations, NNPCL responded with claims of a coordinated attempt to sabotage its leadership and derail its reform agenda.

“The Nigerian National Petroleum Company Limited has uncovered an emerging coordinated sabotage campaign being waged by a syndicate of known and faceless actors, both outside and within various levels of the organisation,” the company said in a Friday morning statement.

The firm alleged a targeted misinformation campaign was being waged to distract executives and mislead the public.

“This group is actively spreading lies and misinformation to discredit NNPC Ltd.’s leadership and derail the organisation’s ongoing transformation into a corruption-free, performance-driven energy company, in line with the mandate of His Excellency, the President of the Federal Republic of Nigeria.”

NNPCL stopped short of naming individuals but insisted it would remain committed to reform, despite internal and external pushback.

Its public defense came in the wake of a Senate Committee on Public Accounts probe, which flagged financial irregularities totaling over N210 trillion in audits from 2017 to 2023.

NNPCL executives failed to appear before the committee, prompting a 10-day ultimatum to show up by July 10 or face constitutional penalties.

The Senate highlighted questionable entries, including N103 trillion in accrued expenses and another N103 trillion listed under receivables—both lacking supporting documentation.

“These are calculated efforts by those who feel threatened by reform, transparency, accountability, and change, clear evidence of the lengths to which they will go to obstruct the transformation of Nigeria’s foremost energy institution,” the company asserted.

“We expect a surge of defamatory content in the days and weeks ahead. NNPC Ltd. remains undeterred. The transformation is underway, and no amount of sabotage will stop it,” it added.

Reaffirming its alignment with President Tinubu’s call for accountability in the oil sector, NNPCL concluded,
“We urge our dedicated staff, stakeholders, and all patriotic Nigerians to stay focused, ignore the noise and not be discouraged. We remain on mission.”

NNPCL yet to remit over N6.5trn in taxes, royalties -FAAC

(PUNCH)