The Federal Government of Nigeria owes the Nigerian National Petroleum Company Limited (NNPCL) N7.74 trillion in fuel subsidy debt due to exchange rate differentials on petrol imports between June 2023 and September 2024. This debt arose as the government maintained fuel prices despite rising import costs.
A document presented to the Federation Account Allocation Committee (FAAC) in February 2025 revealed that the government plans to clear the debt within 210 days. Initially, NNPCL sought a refund of N4.71 trillion, but the outstanding balance increased due to exchange rate fluctuations.
The total exchange rate differential due was N10.499 trillion, but N2.756 trillion was recovered between November 2023 and September 2024, reducing the outstanding amount. The debt, which accounts for 14.07% of Nigeria’s 2025 budget, has sparked debate, with experts questioning the rationale for government refunds to NNPCL despite its oil sales on behalf of the government.
FAAC members also raised concerns over discrepancies in NNPCL’s revenue reports, prompting a reconciliation process involving the NNPCL and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
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