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ABUJA – The World Bank has raised serious questions about revenue handling by the Nigerian National Petroleum Company Limited (NNPCL). A new report from the international body reveals NNPCL remitted only 50 percent of the revenue gains realized from Nigeria’s fuel subsidy removal to the Federation Account (FAAC) in 2024. This significant NNPCL FAAC remittance shortfall finding has put fiscal transparency under the spotlight.
The concerns were detailed in the World Bank’s latest Nigeria Development Update (NDU), released on Monday. The report highlights issues in revenue management since President Bola Ahmed Tinubu’s administration deregulated the downstream petroleum sector. “NNPCL was the only laggard, remitting just N0.6tn to FAAC in 2024, down from N1.1tn in 2023, largely due to the implicit PMS subsidy, which remained in place until the end of September 2024,” the NDU report stated pointedly.
N500 Billion Revenue Gap and Delayed Transfers
The World Bank’s analysis shows that despite NNPCL generating N1.1 trillion in 2024 from crude sales and other income sources, its actual remittance to the Federation Account was only N600 billion. This created a striking N500 billion gap. The report further noted that NNPCL delayed the full transfer of these subsidy savings. Astonishingly, the company only commenced remitting 50 percent of these expected gains in January 2025, several months after the fuel subsidy was officially declared removed in October 2024. The NNPCL FAAC remittance shortfall report clearly outlines this timeline discrepancy.
“Although the subsidy was fully removed on October 1, 2024, NNPCL did not start transferring the resulting revenue gains to the Federation until January 2025. From that point, it began remitting 50 percent, with the other half being used to settle past arrears,” the World Bank report explained.
Calls for Full Remittance and Greater Accountability Mount
The Nigeria Development Update also presented a puzzling contrast. While Nigeria’s overall gross revenue saw a dramatic surge from N16.5 trillion in 2023 to N29.5 trillion in 2024, NNPCL’s financial contribution to the Federation Account unexpectedly dropped. This sharp decline, despite higher national earnings, has prompted the World Bank to issue a clear call for the full remittance of all fuel subsidy revenue gains by NNPCL.
“In spite of a sharp rise in gross revenues by the country’s main revenue-generating agencies… NNPCL’s remittance fell,” the World Bank emphasized. The institution is now urging the Nigerian government to enforce much greater accountability and significantly improve fiscal transparency concerning the NNPCL FAAC remittance shortfall has brought to light.
By Abiodun Labi
