Documents obtained from the Federal Accounts Allocation Committee (FAAC) following its January 2025 meeting have revealed that the Nigerian National Petroleum Company Limited (NNPCL) has withheld a whopping N13.763 trillion in revenue from the Federal Government.
According to the report released on Thursday, this amount covering 2012 and 2024, has significantly impacted the Federation Account, the central pool of funds from which the government allocates resources to federal, state, and local governments across the country.
The document domiciled with the Federation Accounts department revealed the growing financial gap between what the NNPCL should have remitted and the amount deposited into the Federation Account.
It indicated that the national oil firm revealed transactions worth N27.28tn as a balance payable from sales of domestic crude costs within the review period.
However, only N13.524tn was deposited into the Federation Account, leaving a significant shortfall of N13.763tn and creating a growing financial burden for the government.
The report also highlighted that N4.026tn was listed as certified subsidy claims, which have been a long-standing issue in the country’s oil sector.
The withheld revenue raises serious concerns regarding transparency, accountability, and financial management by the national oil firm.
Recently, the NNPCL was accused by the Auditor-General of the Federation of diverting a total sum of N2.68tn and $9.77m in the last four years.
The office, in its annual financial statements reports published between 2017 and 2021, showed that N1.33tn was diverted in 2017, N681.02bn in 2019, N151.12bn ($19.77m) in 2020 and N514bn in 2021 amounting to N2.68tn and $19.77m over four years.
On Tuesday, the Senate resolved to probe the company over the N8.4tn it allegedly withheld as expenditure incurred on payment of subsidies on petroleum products.
Also, the House of Representatives Public Accounts Committee initiated an investigation into the outstanding debts worth $1.6bn royalties owed to the Federation Account by the Nigerian National Petroleum Company Limited and oil companies.
Another report by the Nigeria Extractive Industry Transparency Initiative also accused the NNPCL of failing to remit N3.6tn in taxes to the government.
A year-by-year breakdown of the FAAC document showed that in 2012, the company didn’t remit a sum of N1.42tn but paid N1.54tn to the federation account.
In 2013, N1.58tn was paid to the federation account but N1.043tn was not remitted. N1.359tn was remitted to the federation account in 2014 but N1.17tn was withheld.
The document further stated that N768.94bn was paid to government coffers in 2015 but N586.06bn was withheld. The amount unremitted dropped to N183.58bn in 2016 and N1.18tn was paid to government coffers for disbursement to the three tiers of government.
In 2017, the corporation withheld a substantial N430.62bn from its earnings, yet it still managed to remit an impressive N1.305tn to government coffers. This pattern set the tone for what would be a recurring theme of withholding varying amounts, sometimes substantial, yet still paying significant sums to the federal government.
By 2018, the amount withheld soared to N811.22bn, yet the NNPCL contributed an even larger sum, N1.48tn, to the government. The year-to-year trend saw a peak in 2019 with N703.45bn withheld, while the corporation still managed to send N1.44tn to the federation account.
As the years progressed, however, the withheld amounts began to increase more dramatically. In 2020, N298.06bn was withheld, which was relatively lower compared to previous years.
However, the paid amount still stood at N1.21tn, highlighting the corporation’s ability to pay despite some internal challenges. The situation worsened in 2021 when a staggering N1.94tn was withheld, a clear indication of increased financial pressures or perhaps more strategic financial management. Only N789.03bn was eventually paid to the government.
Then, in 2022, the NNPCL withheld a massive N4.16tn, a figure far surpassing anything seen in the previous years. Also, the total paid amount to the government drastically dropped to just N245.83bn, signalling a severe crunch.
In 2024, the company paid N190.48bn into the federation account but withheld a total amount of N256.27bn.
Efforts to get clarification on what the NNPCL is doing to resolve the situation were futile as the spokesperson, Femi Soneye, didn’t respond to enquiries sent to his WhatsApp line.
Analysts have expressed concern over the impact this situation could have on the Federal Government’s ability to meet its budgetary obligations, as well as the potential effects on state and local government finances.
As the government continues to grapple with economic challenges, the withholding of such a large sum of money by the NNPCL underscores the need for urgent reforms within the country’s oil sector to ensure that revenues are properly accounted for and remitted in full to the Federation Account.
Commenting on the infractions in an earlier interview with The PUNCH, the Centre for Anti-Corruption and Open Leadership (CACOL) described the NNPCL as a hub of institutional corruption, alleging that powerful interests within and outside the government had shielded the organisation from accountability.
CACOL’s Executive Director, Debo Adeniran, lamented that despite the enactment of the Petroleum Industry Act aimed at decentralising and unbundling the NNPCL, the company’s operations remained opaque and rife with allegations of corruption.
According to Adeniran, the NNPCL has always been a source of liquid enrichment for government officials, even before it was converted into a limited liability company.
“The operations of the NNPCL have always been shrouded in secrecy. Even the Petroleum Industry Act has not helped. Despite all the noise about decentralisation and unbundling of the NNPCL, nothing has materialised.
“It is the strongest cabal in Nigeria. All the powerful elements in government and MDAs work in concert with those managing the NNPCL’s accounts, perhaps due to gratification.
“Even the anti-corruption agencies find it difficult to probe the NNPCL. A couple of attempts were made by the ICPC and EFCC in the past, but they have not been able to uncover anything. There must be something shielding the NNPCL from exposure for its corruption crimes,” Adeniran said.
