Nigeria’s public finances are coming under renewed pressure as the Nigerian National Petroleum Company Limited (NNPCL) reported ₦11.2 trillion in receivables from the Federation for 2025, even as the Federal Government accessed $1.5 billion from a $5 billion financing facility arranged with First Abu Dhabi Bank.
According to NNPCL’s audited financial statements, the ₦11.2 trillion represents costs and advances incurred on behalf of the Federation, including spending associated with protecting oil and gas infrastructure from crude oil theft, pipeline vandalism and other disruptions.
NNPCL, however, clarified that the amount should not be interpreted as fresh cash expenditure incurred entirely during 2025. Of the total, about ₦8.67 trillion was classified as energy security cost receivables, with outstanding balances subject to reconciliation against royalties, taxes and dividends due to the government.
Despite the huge financial obligations, NNPCL recorded improved operational performance during the period. Crude oil and condensate production averaged 1.77 million barrels per day, while profit after tax climbed by 33 per cent to ₦7.2 trillion.
Meanwhile, the Federal Government has drawn the first $1.5 billion tranche from its $5 billion Total Return Swap arrangement with First Abu Dhabi Bank.
The financing is expected to help the government refinance more expensive debt, fund infrastructure and support budget implementation.
Unlike a conventional fixed-rate Eurobond, the arrangement allows Nigeria to access the funds in stages, with interest payable only on the amount drawn. However, the facility carries a floating interest rate and is backed by naira-denominated government securities.
First Abu Dhabi Bank is also considering syndicating part of its exposure to other lenders, although the bank is expected to remain Nigeria’s counterparty under the arrangement.
The latest developments highlight the financial challenges confronting the Federal Government, particularly the rising cost of securing the country’s oil assets and the need to raise funds while managing debt, currency and interest-rate risks.