The House of Representatives Public Accounts Committee (PAC) has begun an investigation into the outstanding debts owed to the Federation Account by the Nigerian National Petroleum Company Limited (NNPCL) and several oil companies.

The inquiry, led by the Sub-Committee Chairman, Hon. Akinlade Isiaq, follows concerns raised by the Office of the Auditor General for the Federation regarding financial obligations that remain unsettled by NNPC Ltd and various oil firms.

According to the Auditor General’s report, as of the end of 2021, NNPC Ltd and oil companies owed the Federation approximately $1.6 billion in royalties payable to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) under the Production Sharing Contract, Repayment Agreement, and Modified Carry Arrangement. Further findings indicate that NNPCL’s claims against the Federation stood at N1.9 trillion.

In response to the audit queries, NNPCL’s Group Chief Executive Officer (GCEO), represented by Chief Financial Officer, Dapo Segun, explained that part of the funds in question had been allocated to the government’s Priority Projects (GPP) and subsidy funding, which was sustained until its removal in September 2024.

He explained that the deductions were made from the Federation’s crude oil and gas entitlements, including royalties, and were appropriated to various projects in line with the National Assembly-approved budget.

“Regarding the financial claims between the Federation and NNPC Limited as of December 31, 2024, the reconciliation process is ongoing under the supervision of the Honourable Minister of Finance and Coordinating Minister of the Economy. Once concluded, relevant reports will be made available to all appropriate agencies and stakeholders,” Mr. Segun stated.

The Sub-Committee chairman, Akonlade Isiah in his response, vowed to continue its investigation into 2025, to determine the current status of the debts as of December 2024 and ensure the recovery of outstanding funds.

“This hearing is a crucial step toward ensuring that Nigeria’s oil and gas resources are properly accounted for. We are determined to take all necessary actions to recover these debts in the interest of the Federation and its citizens.”

Consequently, the committee has also summoned oil companies indicted by the NUPRC report, which revealed that they collectively owed the Federal Government $929 million as of September 30, 2024.

The committee also invited other agencies, including the Accountant General of the Federation, the Central Bank of Nigeria (CBN) Nigeria Extractive Industries Transparency Initiative (NEITI), the Ministry of Finance, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), the Bureau of Public Procurement (BPP) and Federal Inland Revenue Service (FIRS)