Nigeria’s ongoing effort to reconcile oil revenues due to the Federation Account has hit a major roadblock, as the Nigerian National Petroleum Company Limited and consultants tasked with auditing its accounts have failed to agree on a $42.3 billion under-remittance allegedly owed to the federation.
The disagreement, disclosed in the February 2026 FAAC Post-Mortem Sub-Committee report obtained in Abuja, highlights persistent challenges in managing the country’s critical oil revenue streams. The disputed sum is separate from a far larger N210 trillion discrepancy identified in NNPC’s audited financial statements covering 2017 to 2023.
The reconciliation exercise was intended to verify oil revenue remittances by comparing NNPC’s internal records with figures from independent consultants, Periscope. However, the parties remain at an impasse.
“NNPCL reported that they are yet to agree with Periscope Consulting regarding the under-remittances of $42.373 billion to the Federation. The NNPCL representative stated that they still maintain their earlier position that the company has nothing to refund to the Federation Account,” the report said.
The FAAC sub-committee directed both parties to continue discussions and reconcile differences before the next plenary meeting. Until resolved, authorities cannot establish the exact volume of oil revenue owed to the Federation Account, which funds allocations to federal, state, and local governments.
Beyond the $42.3 billion dispute, the sub-committee reviewed frontier exploration projects funded under the Petroleum Industry Act. NNPC is required to finance exploration in frontier basins, including the Chad, Sokoto, Bida, and Dahomey basins, as well as the Benue Trough, to expand hydrocarbon reserves.
NNPC submitted details of work performed and funds spent, but an ad-hoc committee will inspect the projects to ensure transparency. Reports show that NNPC received over N453 billion from the Frontier Exploration Fund in 2025, intended for new exploration projects, but recent executive orders now direct the fund to the Federation Account.
Meanwhile, the Senate may summon President Bola Ahmed Tinubu over the N210 trillion discrepancy in NNPC’s audited accounts.
Chairman of the Senate Public Accounts Committee, Aliyu Wadada, said the figure - comprising N103 trillion in accrued liabilities and N107 trillion in receivables - lacks adequate documentation. The liabilities include retention, legal, and audit fees, while the receivables reportedly relate to unnamed defunct banks.
Wadada also questioned NNPC’s explanation that part of the liability represented payments to joint venture partners under the abolished cash-call system. Former NNPC officials, including Mele Kyari and ex-CFO Umar Ajiya, are expected to testify after the Eid break.
The FAAC report stressed the need for stronger oversight and coordination between revenue-generating agencies and those managing the Federation Account. It noted that “persistent revenue leakages, opaque deductions, institutional inefficiencies, and weak oversight continue to erode distributable revenues,” urging urgent engagement to resolve the reconciliation.
With Nigeria’s public finances heavily dependent on petroleum income, resolving these disputes is critical to restoring trust, transparency, and fiscal stability. The ongoing stalemate adds pressure on federal authorities to clarify how billions in oil revenue are accounted for and distributed.
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