The Nigerian National Petroleum Company Limited is burdened with crude-backed loan obligations estimated at N8.07tn, according to an analysis of its 2024 financial statements and capital-commitment disclosures.
The liabilities stretch across multiple forward-sale and project-financing arrangements that are expected to be serviced through substantial crude oil and gas deliveries. The commitments have become a major pillar of NNPCL’s funding structure following years of fiscal pressure, volatile crude production, and declining upstream investment.
Several of the facilities were used to refinance older debts, fund refinery rehabilitation, support cash flow, and meet government revenue obligations.
One of the major exposures is tied to the Eagle Export Funding arrangement. Although the 2024 financial statement notes that “at least 1.8 million barrels” must be delivered per cycle, earlier reporting by The PUNCH shows the facility consists of three separate loan tranches.
The first, a $935m loan obtained in 2020 and backed by 30,000 barrels per day, was fully repaid by September 2023. A second tranche of $635m was also cleared within the same period. The only outstanding portion is the Project Eagle Export Funding Subsequent 2 Debt, a $900m facility secured in 2023 and pledged against 21,000 barrels per day.
Repayment is scheduled to begin in June 2024, with final maturity expected in 2028. As of December 2024, the outstanding balance stood at N1.1tn, making Eagle one of the company’s significant forward-sale exposures.
“The Company had capital commitments of N1.1tn as at the year ended 31 December 2024 (31 December 2023: N1.2tn). This relates to the forward sale agreement with Eagle Export Funding Limited for the delivery of Crude Oil.
“Under the contract, Eagle Export Funding Limited will make an upfront payment to NEPL for crude in a Forward Sale Agreement. The payment received is required to be settled with the delivery of crude oil volumes, i.e., NEPL sells crude to Eagle Export Funding Limited based on a delivery schedule.
“Based on the agreement, at least 1,800,000 barrels of Crude oil must be nominated and scheduled by NEPL (and delivered at the relevant delivery terminal to Eagle Export Limited in every delivery period commencing on 28 August 2020,” the company’s financial statement read.
Another major obligation arises from the incremental gas-supply financing arrangement with the Nigeria LNG Limited. Under the agreement, NLNG provided upfront funding of N772bn for gas supplies to be delivered over time.
By the close of 2024, gas worth N535bn had been drawn and N312bn recovered by NLNG, leaving N460bn yet to be supplied. A financing charge of N12bn also accrued in the period, bringing the total outstanding balance to N472bn.
The refinery rehabilitation programme accounts for some of the largest crude-secured debt commitments. Project Yield, the financing structure backing the Port Harcourt Refinery upgrade, had an outstanding drawdown of N1.4tn at the end of 2024.
The agreement requires NNPCL to deliver refined-product-equivalent volumes of 67,000 barrels per day, with repayment scheduled to begin in June 2025 after a two-and-a-half-year moratorium.
“This is a 7-year N1.5tn PxF loan obtained in October 2022 for general corporate purposes with the ultimate use being the execution of the EPC Contract between PHRC and Tecnimont for the rehabilitation of Port Harcourt Refinery.
“It is secured with a forward sale of refined product equivalent of 67kbpd of crude oil. As of 31 December 2024, the amount drawn is N1.4tn with principal repayment to commence in June 2025 after a moratorium period of 2 years and 6 months.
Therefore, loan commitment as of 31 December 2024 is N1.4tn,” the financial statement read.
Similarly, Project Leopard, another crude-backed forward-sale facility, carried an outstanding balance of N1.3tn. The five-year financing agreement commits the company to deliver 35,000 barrels of crude oil per day, with repayments expected to commence in mid-2025 following a six-month moratorium.
The most significant exposure is tied to Project Gazelle, a large crude-for-cash arrangement used to finance advance tax and royalty payments on Production Sharing Contract assets.
NNPCL had drawn N4.9tn out of the total N5.1tn facility by December 2024. Crude valued at N991bn had been delivered, leaving an outstanding N3.8tn. The agreement requires sustained deliveries of 90,000 barrels per day until the liability is fully extinguished.
When assessed together, the company’s major crude-for-loan facilities—Eagle Export Funding (21,000 bpd), Project Yield (67,000 bpd), Project Leopard (35,000 bpd), and Project Gazelle (90,000 bpd)—represent a combined commitment of 213,000 barrels per day, in addition to separate gas-delivery obligations under the NLNG arrangement.
The volume equates to a sizeable share of Nigeria’s daily crude output, underscoring the long-term implications of these arrangements for government revenue, export allocation, and operational flexibility.
The PUNCH excluded non-debt commitments such as equity stakes in refinery projects and callable capital, which do not qualify as loan obligations. Industry analysts warn that the weight of the obligations leaves NNPCL exposed to fluctuations in crude production and earnings.
The PUNCH earlier reported that Nigeria’s gross profit from crude oil and gas sales plunged by N824.66bn in 2024 despite a rebound in oil production, according to figures from the latest Budget Implementation Report for the fourth quarter of 2024 released by the Budget Office of the Federation.
Data from the report revealed that gross profit from crude and gas sales fell to N1.08tn during the year, from N1.90tn in 2023, representing a 43.32 per cent decline.
The 2024 performance was also 26.3 per cent below the government’s budgeted target of N1.46tn, underscoring the persistence of weak fiscal inflows from the petroleum sector despite policy reforms aimed at boosting revenue.
Nigeria’s crude output fluctuated between 1.4 and 1.6 million barrels per day, below the 1.78 million barrels per day target used in the 2024 budget.
Despite being the country’s traditional fiscal anchor, gross profit from crude oil and gas sales accounted for only about eight per cent of total oil and gas revenue in 2024, highlighting the structural shift in government earnings toward taxes, royalties, and penalties.
The PUNCH also observed that Nigeria’s crude-oil production inched up in 2024, with data from the Nigerian Upstream Petroleum Regulatory Commission showing that output rose to 442.21 million barrels, compared with 392.66 million barrels in 2023.
The increase of 49.55 million barrels, or 12.62 per cent, marked a modest recovery in upstream performance following three years of volatility and output disruptions. On a daily-average basis, Nigeria pumped about 1.43 million barrels per day in 2024, up from 1.27 million barrels per day the previous year.
The gradual improvement reflected reduced vandalism along major crude-evacuation corridors, improved coordination among joint-venture partners, and incremental barrels from marginal-field operators licensed under the Petroleum Industry Act.
Despite the increase, Nigeria’s output still lagged its fiscal target of 1.78 million bpd, reflecting lingering infrastructure constraints, under-investment, and crude theft. The shortfall means that actual production achieved only about 80 per cent of the government’s projection, a key reason oil-revenue inflows missed the 2024 budget despite nominal gains from exchange-rate revaluation.
Meanwhile, NNPC’s remittances to the government have repeatedly come under scrutiny by local and international organisations. Earlier this year, the World Bank said NNPC was remitting only half of the financial gains from the removal of petrol subsidies due to debt arrears. It said that, out of the N1.1tn revenue from crude sales and other income in 2024, NNPC remitted only N600bn, leaving a deficit of N500bn unaccounted for.
“Despite the subsidy being fully removed in October 2024, NNPCL started transferring the revenue gains to the Federation only in January 2025. Since then, it has been remitting only 50 per cent of these gains, using the rest to offset past arrears,” the World Bank noted.
The Chief Executive Officer of AHA Strategies and oil and gas expert, Mr Ademola Adigun, earlier linked Nigeria’s declining oil earnings to opaque crude-for-cash agreements and undisclosed loan repayments that have tied up part of the country’s crude output.
He said some of the government’s oil barrels were already committed to debt settlements and forward-sale contracts, reducing the actual volume that brought fresh revenue into the Federation Account.
In October 2024, The PUNCH reported that the Nigerian National Petroleum Company Limited pledged 272,500 barrels per day of crude through a series of crude-for-loan deals totalling $8.86bn.
Pledging 272,500 barrels daily means that about 8.17 million barrels of crude are diverted monthly for various loan arrangements, based on an analysis of a report by the Nigeria Extractive Industries Transparency Initiative and the NNPCL’s financial statements.
Adigun said, “Some of our crude is already tied up in loan agreements. The problem is that Nigeria doesn’t know the full details of these transactions because there’s little transparency around them.”
He explained that several crude-backed projects, such as Project Gazelle, were carried out without proper public disclosure or parliamentary scrutiny. He added that the Nigeria Extractive Industries Transparency Initiative should strengthen its audits to determine how much of the country’s crude is being used for debt repayment or swap transactions.
Development economist and Chief Executive Officer of CSA Advisory, Dr Aliyu Ilias, said Nigeria’s crude trading structure had become increasingly complex, involving swaps and oil-to-naira exchanges that might not be fully accounted for. He urged the government to commission a study on how such short-term crude transactions affect fiscal performance.
The Director of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, recalled that during the tenure of the former Central Bank Governor, Godwin Emefiele, several forward-sale deals were signed to raise emergency funds when the government faced fiscal pressure.
“During the Emefiele years, Nigeria committed a lot of its crude up front,” he said. “Those forward sales are still eating into our current earnings.”
He explained that the combination of forward sales, opaque trading, and off-balance-sheet transactions had distorted the relationship between production and earnings.
Yusuf, however, noted that transparency and professionalism within the Nigerian National Petroleum Company Limited had improved under the current administration of Bayo Ojulari. “Under the new management of the NNPCL, there’s better professionalism and openness,” he said.
He added that the government must disclose the full details of its crude swap and forward-sale agreements to restore confidence in oil revenue reporting.
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