Business

NNPCL secures N318bn to fund new oil exploration

Published

1 year ago

September 25, 2025

The Nigerian National Petroleum Company Limited has received N318.05bn between January and August 2025 for frontier oil exploration, findings by The PUNCH have shown.

This is according to documents from the September 2025 Federation Account Allocation Committee meeting obtained by The PUNCH.

The deductions represent 30 per cent of Production Sharing Contract profits, which are automatically set aside each month for exploration in inland basins.

The Petroleum Industry Act 2021 created the Frontier Exploration Fund, which mandates that 30 per cent of profits from NNPC’s Production Sharing Contracts be channelled into oil search across under-explored basins, including Anambra, Bida, Dahomey, Sokoto, Chad and Benue.

Regulations also require the Nigerian Upstream Petroleum Regulatory Commission to manage the fund through an escrow account and issue an annual Frontier Basin Exploration and Development Plan.

Further findings by The PUNCH showed that the NUPRC in July 2025 unveiled a Frontier Basin Exploration and Development Plan detailing proposed seismic surveys, stress-field detection, data integration, and wildcat drilling across basins in Benin Dahomey, Anambra, Bida, Sokoto, Chad, and Benue.

The plan outlined work such as logging and testing of the Eba-1 well in the Dahomey basin, drilling of a new wildcat in Bida, reappraisal of Wadi wells in Chad, and reassignment of Ebeni-1 drilling in Benue.

Signed by the Chief Executive of the NUPRC, Gbenga Komolafe, the document stated that the outcome of these activities would determine further de-risking of assets and exploratory drilling in line with statutory requirements.

Analysis of the FAAC documents by The PUNCH further showed that PSC profits so far this year amounted to N1.06tn, below the budgeted N1.58tn, creating a shortfall of N518.76bn.

Despite this gap, the statutory 30 per cent deduction for frontier exploration was consistently applied, month after month, producing an accumulated N318.05bn by August.

The monthly trend reveals the volatility of the fund. In January, N31.77bn was deducted into the frontier line, when PSC profits came in at N105.91bn.

The February deduction rose to N38.30bn from a profit of N127.67bn, representing a 20.6 per cent increase on the January inflow.

March provided the first big surge, with N61.49bn allocated to frontier exploration from profits of N204.96bn, a jump of 60.5 per cent on February’s figure.

April, however, saw deductions ease back to N36.58bn as profits slid to N121.93bn, a 40.5 per cent drop compared with March.

In May, the fund received N38.8bn, only slightly higher than April’s contribution, reflecting profit of N129.33bn.

June delivered the lowest allocation so far this year, just N6.83bn, after profits collapsed to N22.77bn. That represented an 82.4 per cent fall from May.

The flow recovered somewhat in July, with N25.34bn transferred into the fund from profits of N84.48bn.

In August, the line shot up again to its highest level so far this year. With PSC profit surging to N263.13bn, the fund received N78.94bn, more than three times the July amount and twelve times June’s contribution.

Across the eight months, the monthly allocations to the frontier fund varied sharply, from as little as N6.83bn in June to as much as N78.94bn in August.

Yet by the end of the period, the automatic deductions had steadily accumulated N318.05bn into NNPCL’s control for exploration in new oil basins.

The same 30 per cent rule also applied to NNPCL’s management fees, which mirrored the frontier deductions exactly.

In January, NNPCL booked N31.77bn; in February, N38.30bn; in March, N61.49bn; in April, N36.58bn; in May, N38.8bn; in June, N6.83bn; in July, N25.34bn; and in August, N78.94bn.

This brought the company’s management fees to N318.05bn in the first eight months of the year.

Based on the figures, the oil firm got a total of N636.1bn for frontier exploration and management fees.

The PUNCH further observed that the Federation Account, entitled to 40 per cent of PSC profits, also experienced the same volatility.

It received N42.364bn in January and N51.067bn in February. March brought N81.985bn, the strongest inflow of the first quarter.

April saw a fall to N48.772bn, followed by N51.730bn in May. June gave the lowest figure of the year at N9.110bn.

In July, receipts rose again to N33.792bn, before climbing steeply to N105.250bn in August, the largest monthly payout so far.

Year-to-date, the Federation Account has received N424.071bn from PSC profits, still well behind the budgeted N631.573bn, leaving a shortfall of N207.502bn.

The FAAC documents confirmed that while PSC profits generated just over N1.06tn this year, the deductions left the Federation Account with significantly less to share among the three tiers of government.

The pressure has been compounded by the non-performance of NNPCL’s interim dividend line.

Budgeted at N271.184bn per month, or N2.169tn year-to-date, the company has not remitted any amount so far, leaving a gaping hole in the federation’s revenue plan.

The issue has prompted closer scrutiny. The FAAC documents record that a special subcommittee was set up to examine the 30 per cent frontier deductions.

The committee met with NNPCL, the Nigerian Upstream Petroleum Regulatory Commission, and the Central Bank of Nigeria.

At the meeting, NNPCL presented details of exploration activities carried out in all the inland basins from 1999 to date and outlined its intended activities for 2025.

Committee members, however, demanded greater transparency, insisting that NNPCL provide detailed financial records of projects undertaken before and after the Petroleum Industry Act was passed.

The company was directed to submit the information by September 19, 2025, but the documents noted that the assignment was still “work in progress.”

The Director-General of the Budget Office of the Federation, Tanimu Yakubu, earlier said Nigeria had lost nearly 60 per cent of its gross oil revenue to deductions under the Petroleum Industry Act 2022, which allocates 30 per cent to the NNPCL as management fees and another 30 per cent to the Frontier Exploration Fund.

He made this statement at a stakeholders’ engagement in Abuja, organised by the Office of the Accountant-General of the Federation, to review progress and challenges in implementing the extended 2024 capital budget and the 2025 capital budget under the Bottom-Up Cash Planning Policy.

“Once the Act came into effect without new revenue sources to replace the loss, we lost a sizable part of what used to fund 80 per cent of public expenditure,” Yakubu said.

He added that oil revenues had performed even worse in the first half of 2025 due to low prices and output shortfalls.

Yakubu said he had begun moves in the National Assembly to amend the PIA to recover part of the lost revenue.

During the Federal Executive Council meeting in Abuja last month, President Bola Tinubu directed a review of deductions and revenue retention practices by Nigeria’s major revenue-generating agencies.

The move aims to boost public savings, enhance spending efficiency, and unlock resources for growth.

The agencies include the Federal Inland Revenue Service, the Nigeria Customs Service, the Nigerian Upstream Petroleum Regulatory Commission, the Nigerian Maritime Administration and Safety Agency, and the Nigerian National Petroleum Company Limited.

Tinubu specifically called for a reassessment of NNPC’s 30 per cent management fee and 30 per cent frontier exploration deduction under the Petroleum Industry Act.

He tasked the Economic Management Team, chaired by Edun, to present actionable recommendations to the FEC on the optimal way forward.

The President said the directive was part of efforts to sustain reforms that have dismantled economic distortions, restored policy credibility, enhanced resilience, and bolstered investor confidence.

However, the Petroleum and Natural Gas Senior Staff Association of Nigeria, as well as the Nigeria Union of Petroleum and Natural Gas Workers, rejected the Federal Government’s plans to divest significant stakes in Joint Venture assets managed by the Nigerian National Petroleum Company Limited.

The two unions warned that the move to allegedly amend the Petroleum Industry Act and remove the running of oil and gas from the NNPCL could endanger the country’s economic stability, weaken its oil industry, and jeopardise the welfare of workers.

They stated that the policies are dangerous and capable of bankrupting the Nigerian National Petroleum Company Limited.

The oil workers urged President Bola Tinubu to intervene and halt the plan.

Experts seek deductions

Speaking with The PUNCH on Wednesday, the Chief Executive Officer of AHA Strategies, who is an oil and gas expert, Mr Ademola Adigun, has faulted the 30 per cent allocation of Production Sharing Contract profits to frontier oil exploration, describing it as “unrealistic and too high.”

Reacting to revelations that NNPCL received N318.05bn for frontier exploration in just eight months without paying dividends to the Federation Account, Adigun said the current arrangement was not justifiable under prevailing economic conditions.

“The money allocation is unrealistic, too high. It is not well used now,” he stated.

He backed President Bola Tinubu’s call for a review of deductions by major revenue agencies, including NNPCL, insisting that more revenue should flow into the Federation Account. “I don’t think it’s worth it to continue this way,” Adigun added.

The industry expert recommended that the frontier allocation be cut drastically, proposing that it should not exceed 10 per cent.

“Maximum of 10 per cent is what I would suggest,” he said.

However, an energy law scholar at the University of Lagos, Professor Dayo Ayoade, has cautioned against a hasty amendment of the Petroleum Industry Act, stressing that the law took nearly two decades of negotiations and compromises before it was passed.

Reacting to the revelations on frontier deductions, he said, “It took us 19 years of reform to agree on the PIA, and the PIA is actually a delicate balance of a lot of compromises. The Frontier Exploration Fund, in many ways, was like a counterbalance to the Host Community Trust Fund.”

While acknowledging Nigeria’s urgent revenue needs, Ayoade insisted that NNPCL must give a detailed account of the money it has collected for frontier exploration.

“It was one of the biggest problems I had with the PIA because I knew that 30 per cent of PSC profits going into just exploration was too high. I would rather that exploration be liberalised and put in the hands of the private sector,” he explained.

He suggested that private investors willing to take the risk of exploring frontier basins should be offered strong tax and operational incentives, instead of government using public funds through NNPCL.

“There should not be any NNPCL spending government money on this project,” Ayoade added.

The scholar also warned that the current funding model posed risks to fiscal federalism and undermined NNPCL’s commercial credibility.

“The funding structure is not really sustainable, and that is the truth. NNPCL is not really a commercial company. All it does is act as a middleman for government and collect money it has not really earned,” he argued, adding that the company should be judged by profits generated from its own fields and operations rather than from joint ventures or production sharing arrangements.

punch.ng

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Business

Four Nigerians among Forbes Africa’s 15 icons for 2026, see full list

Published

9 hours ago

October 12, 2026

Newsbreak365_Admin

Four Nigerians, Aliko Dangote, Ngozi Okonjo-Iweala, Mo Abudu and Burna Boy, have been named among 15 personalities featured on Forbes Africa’s inaugural Icons list for 2026.

PUNCH Online on Saturday reported that the list, published in the magazine’s October-November anniversary edition, recognises individuals whose ideas, innovations and voices have influenced Africa’s past, present and future.

The selection marks the 15th anniversary of Forbes Africa, which said it chose personalities whose work had made a lasting impact beyond their industries and national borders.

The four Nigerians represent business, international economic leadership, media and music.

Dangote, president of Dangote Group, is recognised for his role in African industry and private enterprise.

Okonjo-Iweala, director-general of the World Trade Organization and a former Nigerian finance minister, represents Africa’s presence in international economic leadership.

Abudu, founder and chief executive of EbonyLife Group, is recognised for her contribution to African media and entertainment, while Burna Boy, whose real name is Damini Ebunoluwa Ogulu, represents the international reach of Nigerian music.

The other personalities on the list are South African businessman Adrian Gore, CAF president and businessman Patrice Motsepe, Zimbabwean entrepreneur Strive Masiyiwa and former Liberian President Ellen Johnson Sirleaf.

Also featured are Nobel Prize-winning novelist Abdulrazak Gurnah, Ethiopian athletics legend Haile Gebrselassie, former Ivorian footballer Didier Drogba, South African businessman Johann Rupert, Kenyan-Mexican actor Lupita Nyong’o, South African comedian Trevor Noah and Beninese musician Angélique Kidjo.

The 15 personalities represent sectors including business, public service, literature, sport, music and entertainment.

According to Forbes Africa’s methodology, the selection was based on factors including global recognition, legacy, measurable economic, social or cultural influence, and contributions to Africa’s growth narrative over the years.

The magazine said its editorial team consulted established figures, experts and professionals in the respective industries to gather insights on the honourees’ impact and legacy.

The list is presented in no particular order, the release noted.

Full list of Forbes Africa Icons 2026

– Mo Abudu — Nigerian-British media entrepreneur and founder-chief executive of EbonyLife Group.

– Ngozi Okonjo-Iweala — Nigerian economist and director-general of the World Trade Organization.

– Adrian Gore — South African businessman and founder-chief executive of Discovery Group.

– Patrice Motsepe — South African businessman and president of the Confederation of African Football.

– Strive Masiyiwa — Zimbabwean entrepreneur and founder and executive chairman of Econet Global and Cassava Technologies.

– Ellen Johnson Sirleaf — Former president of Liberia.

– Aliko Dangote — Nigerian industrialist and president of Dangote Group.

– Burna Boy — Nigerian singer and songwriter.

– Abdulrazak Gurnah — Zanzibar-born novelist and Nobel laureate in Literature.

– Haile Gebrselassie — Ethiopian athletics legend and businessman.

– Didier Drogba — Former Ivorian footballer.

– Johann Rupert — South African businessman and chairman of Compagnie Financière Richemont.

– Lupita Nyong’o — Kenyan-Mexican actor.

– Trevor Noah — South African comedian, writer, producer and former host of The Daily Show.

– Angélique Kidjo — Beninese musician and actor.

Forbes Africa said the list celebrates individuals whose contributions have helped shape the continent’s development and standing on the global stage.

Source: punchng.com

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Business

Lagos e-hailing drivers begin indefinite strike over fares

Published

10 hours ago

October 12, 2026

Newsbreak365_Admin

E-hailing drivers in Lagos State have begun an indefinite strike over concerns about fare structures, commissions, deductions and welfare.

The drivers, under the Amalgamated Union of App-Based Transporters of Nigeria, announced the industrial action in a notice seen by PUNCH Metro on Saturday, saying it would commence on Monday and continue until further notice or satisfactory progress was made in addressing their grievances.

AUATON, an affiliate of the Nigeria Labour Congress, said the strike followed persistent concerns over operational policies, drivers’ welfare, safety, security and the sustainability of their operations.

“Despite repeated efforts by drivers and stakeholders to draw attention to these concerns, many of the issues remain unresolved,” the union said.

It added that the decision to embark on the strike was informed by the need to address challenges affecting drivers’ earnings and working conditions.

To cushion the impact of the industrial action, AUATON appealed to fleet owners and managers to grant temporary relief from daily remittance obligations and related operational targets for the duration of the strike.

“During the industrial action, drivers will not be generating their normal revenue from which daily remittance obligations ordinarily arise.

“We, therefore, appeal to fleet partners to refrain from imposing penalties, sanctions or adverse measures solely on the basis of a driver’s participation in the action, as drivers are not expected to operate during this period,” the notice read.

The union said its task force would be deployed across all local government areas in Lagos State to monitor compliance with the strike.

It warned that drivers found operating in violation of its directives could face sanctions under its internal disciplinary measures.

AUATON, however, urged fleet owners, managers and affected drivers to maintain open communication and resolve operational concerns through constructive engagement during the strike.

Highlighting the potential benefits of addressing its demands, the union said improved earnings, welfare and operating conditions could help boost driver retention, reduce turnover and improve commitment among drivers.

“Meaningful improvements in driver earnings, welfare and operating conditions may contribute to improved driver retention and reduced turnover, better driver commitment and engagement, more sustainable vehicle utilisation and reduced operational disputes between drivers and fleet partners,” it said.

The union added that better earnings could also improve vehicle maintenance and promote stability in the app-based transportation sector.

It stressed that its objective was not to disrupt businesses unnecessarily but to advocate better operating conditions for drivers and other stakeholders.

The notice was signed by the Lagos State Chairman of AUATON, Jaiyesimi Olalabi Azeez, popularly known as Makavelli, who appealed to fleet partners for understanding and cooperation.

The union reiterated its commitment to peaceful engagement and constructive dialogue with fleet owners, managers and other stakeholders to find lasting solutions to the issues prompting the industrial action.

Source: punchng.com

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Tinubu reveals that World Bank report affirms reform gains

Published

11 hours ago

October 12, 2026

Newsbreak365_Admin

President Bola Tinubu on Sunday welcomed the World Bank’s latest Nigeria Development Update, saying its findings, including that the poverty rate has stabilised for the first time since 2019, confirm that his economic reforms are working.

In a statement on Sunday by his Special Adviser on Information and Strategy, Bayo Onanuga, the President said the October 2026 edition of the report, titled ‘Beyond the Federal Purse: How Higher Revenues Reshaped State Priorities,’ showed that the reforms were delivering results and putting the economy on a firmer footing for sustained growth.

He noted the bank’s expectation that poverty will decline gradually as gross domestic product grows faster than the population.

According to the report, the economy grew 4.2 per cent in the first half of 2026, up from 3.9 per cent in the first half of 2025, despite the impact of the conflict in the Middle East.

The bank projected growth to average at least 4.4 per cent between 2026 and 2028.

On prices, it said inflation fell from 27.6 per cent in January 2025 to 15.2 per cent in December 2025.

Higher global fuel prices linked to the Middle East conflict have since slowed the decline, but the bank said it expects inflation to ease to about 12 per cent by 2028.

The report also said the current account surplus rose to $12bn, or 7.0 per cent of GDP, in the first half of 2026, from $8.6bn a year earlier.

Gross external reserves increased from $45.5bn at the end of 2025 to $53.8bn at the end of August 2026.

The bank credited the reforms since 2023 with raising federation revenues by 69 per cent in real terms between 2023 and 2025, with states the largest beneficiaries.

It said states used the extra resources to increase capital spending by 151 per cent in real terms over the same period, most of it going to roads and other transport, agriculture, energy and housing.

Twenty-nine of 33 states shifted spending towards economic infrastructure, while real social spending per person rose in all but one state, the report said.

It also found that internally generated revenue grew in real terms in 31 of 35 states; 21 states reduced their debt-to-GDP ratio between 2021 and 2025; and Nigeria’s overall public debt is expected to fall from 40.0 per cent of GDP in 2025 to 38.1 per cent in 2026.

Tinubu said the findings confirmed that “the difficult but necessary decisions to remove the petrol subsidy, unify the foreign exchange market and strengthen fiscal discipline have raised revenues, stabilised the economy and created fiscal space for every tier of government to invest in its people.”

“The dividends of reform are becoming visible,” he said, adding, “But more work remains to ensure they fully translate into better living standards for every household, starting with lower food prices and decent jobs for our young people.”

He said his administration would “stay the course of reform and redouble its focus on inclusive growth under the Renewed Hope Agenda.”

Tinubu promised to keep expanding targeted cash transfers, which he said had already reached more than 10 million households.

He also pledged to accelerate the rollout of Compressed Natural Gas, raise agricultural productivity, and improve access to affordable healthcare and quality education “so that the prosperity being created is shared by all.

President Tinubu urged state governments to use their higher revenues “more prudently” and to prioritise projects that improve living standards and the health and education of residents.

He commended the Economic Management Team, led by the Minister of Finance and Coordinating Minister of the Economy, as well as state governors and other stakeholders, for their cooperation in implementing the reforms.

He said, “I assure Nigerians that the best is yet to come under the Renewed Hope Agenda 2.0, which will accelerate the delivery of shared prosperity for all Nigerians.

Source: punchng.com

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