NNPCL: Beyond the ₦210 Trillion Unanswered Question

SOStainabilityWeekly

Edited by Oke Epia, E-mail: sostainability01@gmail.com  | WhatsApp: +234 8034000706

Washing and Hushing

The controversy around the ₦210 trillion unaccounted funds in the audited financial statements of the Nigerian National Petroleum Company Limited (NNPCL) has refused to die in a hurry. It raises inevitable questions of accountability, oversight, and the credibility of public institutions. It also raises deeper questions about whether reform efforts and donor engagements in Nigeria’s petroleum and energy sectors are yielding expected results.

In 2025, the Senate Committee on Public Accounts, led by Senator Aliyu Wadada, flagged ₦210 trillion in financial discrepancies from NNPCL’s audited accounts covering 2017 to 2023. These figures were reportedly extracted from audit reports by the Office of the Auditor‑General of the Federation. The amount is broadly divided into ₦103 trillion in accrued expenses and ₦107 trillion in receivables that lack adequate supporting documentation. The Senate has been consistent in stating that this is not an allegation of theft, but rather that the amounts are “unaccounted for and unjustified based on available records.”

Despite repeated summonses, notice deadlines, written queries, and deadlines including a three‑week ultimatum to provide detailed explanations, NNPCL’s responses have so far been considered insufficient, inconsistent, or evasive by lawmakers. At a public hearing in November 2025, the Senate explicitly rejected NNPCL’s written explanations and described the management’s failure to appear before the committee as “offensive evasiveness.” The panel went so far as to direct that the ₦210 trillion must be refunded to the federation account unless credible justification is provided. One cannot underestimate how extraordinary this is: a budgetary figure larger than Nigeria’s annual appropriation being publicly questioned with no clarity.

Two Years of Senate Oversight: Why Has Nothing Changed?

On the surface, it looks like the Senate has been thorough: documented audit queries, repeated directives, and formal rejections of insufficient evidence. But dig deeper, and structural weaknesses emerge. The Nigerian Senate can summon, question, reject explanations, and even recommend refunds of funds, but it cannot enforce compliance or punish obstruction. Actual enforcement depends on other agencies, which are often bureaucratic, under‑resourced, or aligned with political leadership rather than independent enforcement. Accountability isn’t driven by a single point of authority. Even though the Auditor‑General flags discrepancies, the Public Accounts Committee identifies them, and the Senate demands answers, enforcement relies on agencies like the Economic and Financial Crimes Commission (EFCC) or the courts which tend to move slowly in high‑profile cases.

What the Petroleum Industry Act (PIA) Demands

The Petroleum Industry Act (2021) was designed to fix exactly this kind of opacity. Under the PIA, NNPCL is no longer a traditional state-owned corporation. It is now a commercial entity with clear obligations: Publish audited financial statements annually, operate with commercial discipline and transparency, and ensure traceability of revenues, costs, and remittance. But laws do not enforce themselves. The PIA created institutions specifically tasked with ensuring compliance. So if NNPCL’s financial disclosures remain difficult to verify, then the issue is not the absence of legal frameworks. It is whether those frameworks are being enforced. At first glance, it might seem surprising that two years of inquiries have yielded few concrete outcomes. But to understand why this is not simply about political will, we must look at structural realities. NNPCL was transformed under the Petroleum Industry Act (PIA, 2021) from a statutory corporation into a limited liability company, with an expectation under the reform to publish audited accounts and operate with commercial discipline. Yet despite these reforms, financial disclosures remain complex, hard to independently verify, and difficult for the public to interpret. In effect, the audit findings are public; the reasons behind the numbers remain opaque. This undermines not just transparency, but public trust in the efficacy of Nigeria’s institutional checks and balances. 

NNPC and the Energy Transition 

In recent years, NNPCL has publicly embraced energy transition. The company’s sustainability framework, grounded in the goals of the Petroleum Industry Act and Nigeria’s climate commitments, recognizes the need to engage in renewable energy business and decarbonization.  Under this commitment, subsidiaries like NNPC New Energy Limited (NNEL) have been set up to focus on low‑carbon initiatives electric vehicle (EV) charging stations. While NNPC’s publicly stated mission embraces energy transition, there is no publicly accessible, independently verified mechanism showing how funds directed at renewable projects are tracked, audited, and reported in real time. Unlike oil revenues that still poses a struggle to reconcile, renewable energy project financing, especially those backed by international donors and development partners, requires detailed impact metrics, environmental and social safeguards, and periodic disclosures. Are these readily available in a way that builds confidence in NNPC’s renewable agenda? If NNPCL cannot clearly account for historical oil revenue figures, how will it transparently manage climate finance and renewable investments? Without clear answers, the risk is that energy transition becomes another space where activism or rhetoric outpaces accountability. Questions are also raised about the role of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which provides oversight over the NNPCL upstream operations, where the bulk of Nigeria’s oil revenues are generated. The Commission is expected to monitor production volumes, verify costs, track revenues, and ensure that operators—including NNPCL—comply with financial and operational regulations. On this N210 trillion controversy, what has the NUPRC done? Has it conducted independent reconciliations between NNPCL’s reported figures and actual production and sales data? Has it done enforcement where reporting falls short? If the regulator cannot clearly account for the financial flows within the sector it oversees, then regulation risks becoming procedural rather than effective. Besides the NUPRC, the Financial Reporting Council of Nigeria (FRC), also has some responsibility since NNPCL, as a limited liability company, is required to comply with international financial reporting standards. Has the FRC interrogated these controversial NNPCL figures? Beyond financial reporting, the FRC is also responsible for advancing sustainability disclosures under global standards like IFRS S1 and S2. NNPCL has publicly embraced energy transition and sustainability initiatives. But are these backed by standardized, independently verifiable disclosures? Or are they still largely narrative commitments? If Nigeria is positioning itself within global climate finance frameworks, then the credibility of its largest oil company’s disclosures is not optional. It is foundational.

Accountability Gaps Have Environmental Consequences

Accountability isn’t only about finance; it has real environmental and social impacts. Nigeria’s petroleum operations have a long history of environmental harm: oil spills, gas flaring, land degradation, and carbon emissions that contribute to climate change and local health issues. If financial transparency is weak, environmental governance follows the same pattern. For example, penalties and remediation obligations related to gas flaring are supposed to be tracked, published, and audited, yet substantive public reporting on compliance is limited or buried in company disclosures that lack independent verification. In this context, accountability gaps enable environmental degradation to continue unchecked. Without clear, independent monitoring of fund flows, especially those meant for environmental remediation or community infrastructure, polluters cannot be held to account, and communities suffer indefinitely in silence.The story of ₦210 trillion unaccounted funds is not just about numbers. It is about a system that produces complex financial records without transparent, enforceable accountability. Two years of oversight have produced extensive hearings and public debate. Yet without enforcement, clear metrics, independent verification, and genuine participatory monitoring, even the most detailed audit is just a bureaucratic exercise. For Nigeria, this is pivotal. The country’s economic future, from oil revenues to climate financing, depends not just on tracking funds but on ensuring they are auditable, accountable, and applied where they matter most: community development, infrastructure, environmental protection, and a just energy transition. And until that happens, ₦210 trillion will not be a mystery to solve but a warning unheeded.

Trends and Threads

Cash, Carbon Sinks and Nigeria’s Deforestation Crisis

Last week, the world marked International Day of Forests. It was a moment to reflect on Nigeria’s deforestation crisis and the opportunity costs of carbon sinks. Deforestation is not just about trees disappearing. It is less an environmental accident and more a failure of governance. And that failure is no longer manifest within forests as insecurity, deepening climate stress, and rising health issues are sprouting fast from the tree. 

The Stark Reality of Deforestation

Nigeria’s forest loss is not anecdotal: it is measurable, consistent, and alarming. Between 2001 and 2022, the country lost about 12 percent of its tree cover, with an average loss estimated at over 160,000 hectares per year. More recent assessments show that 1.33 million hectares of tree cover have disappeared since 2000, releasing hundreds of millions of tons of carbon. Yet what is striking is not just the scale but the disconnect. Nigeria has policies. It has frameworks. It has international commitments. The Climate Change Act, for instance, was widely praised for introducing carbon budgets and institutional coordination through the National Council on Climate Change. The National Forest Policy outlines sustainable forest management. Under the UN-backed REDD+ Programme, Nigeria has received support to reduce emissions from deforestation. On paper, these are strong frameworks. But on the ground, something is clearly not working. Therefore, the real question is not what policies exist, but why they are not translating into measurable outcomes.

The Climate Change Act introduced carbon budgeting, institutional coordination, and climate governance structures. In theory, deforestation should now be tracked, reported, and reduced, but even as these frameworks expand, forest loss continues at scale. A 2025 World Bank analysis confirms that agriculture and fuelwood remain the dominant drivers of deforestation, pointing to systemic economic pressures that policies have failed to address. But there is another layer, which is enforcement failure and weak monitoring systems. In many forest reserves, logging permits are issued, fees are collected, and conservation rules exist, but there is little follow-through. Monitoring is often manual, fragmented, and vulnerable to manipulation. In reality, there is a system where policies are declared at the national level but enforcement collapses at the state and local levels. An example is the Omo Forest Reserve in Ogun State, where an investigation by Associated Press revealed that illegal cocoa farming is happening deep inside protected conservation zones, and that licensed buyers knowingly purchase cocoa grown from deforested land and enforcement agencies are either absent or compromised. Rangers on the ground consistently report cases of bribery, threats, and a lack of consequences for offenders and this is where the issue becomes unavoidable: If funds are collected and projects are funded, but forests are still disappearing, who is being held accountable?

From Forest Loss to Frontline Conflict

Deforestation does not just remove trees: it reshapes how land is used, who controls it, and who is fenced out. Across Nigeria, especially in the Middle Belt and up North, environmental degradation is intensifying competition over land. Research consistently shows that disappearing forests push communities into new territories, often triggering conflict. As forests shrink, farmers move into marginal lands, pastoralists migrate further south in search of grazing and previously stable boundaries collapse. This is where environmental stress turns into violence. In states like Benue and Nasarawa, farmer–herder conflicts are no longer just about ethnicity or politics; they are rooted in shrinking ecological space, and once violence begins, it creates a feedback loop: communities abandon farms; land becomes ungoverned; and armed groups occupy forested areas. The forest, once an economic and ecological asset, becomes a security liability. Nowhere is this more visible than in Northern Nigeria, where the region is already under pressure from desertification, which now affects 15 states, with the Sahara advancing southward at approximately 0.6 km per year, declining rainfall patterns, and the shrinking of water bodies like Lake Chad by about 90 percent since the 1960s, undermining livelihoods for millions. The World Bank notes that climate shocks, including drought and land degradation, are already threatening livelihoods at scale. The Akpanta killings are one of many recent examples. At least 38 people were killed in March 2025 in Benue State in a conflict rooted in disputes over land and grazing routes, disputes intensified by environmental degradation and migration patterns. Similarly, the 2021 Nasarawa massacre, which left over 50 people dead, reflects long-standing tensions over land use exacerbated by overgrazing and ecological stress. These are not isolated incidents but symptoms of a systemic failure to manage environmental change.

Big Cash Limited Impact

Nigeria has attracted substantial international funding for reforestation, land restoration, and climate resilience. Programmes linked to REDD+, World Bank interventions, and other donor-backed initiatives are worth hundreds of millions of dollars. One major initiative is the Agro-Climatic Resilience in Semi-Arid Landscapes (ACReSAL), a $700 million World Bank-supported programme aimed at restoring degraded landscapes in Northern Nigeria. Yet, despite such large-scale investments, key questions remain largely unanswered: How are these funds tracked at the project level? What independent monitoring systems verify reforestation outcomes? How many hectares have actually been restored versus reported? What proportion of funds reach local communities versus administrative overheads? There is limited publicly accessible, verifiable data that connects funding inputs to measurable ecological outcomes, and this creates a dangerous accountability gap: projects exist on paper, funding flows are announced, but ground-level impact remains unclear or inconsistent. At the same time, Nigeria is improving its technical reporting systems such as submitting updated forest monitoring data to the UN climate framework, and this raises a critical tension: Improved reporting does not always mean improved outcomes; there is still limited public clarity on how much forest has been restored versus reported, how funds are distributed across federal, state, and local actors and whether independent verification exists beyond official reports And this leads to uncomfortable but necessary questions: Are donors relying too heavily on government-reported data? Who independently verifies that reforestation actually happens? What happens when projects fail, are funds withdrawn, or simply restructured and renamed? Without clear answers, there is a risk that success is being measured by funding disbursed, not forests preserved.

Untapped Sink Capacity and the Politics of Monetisation

At the most basic level, forests function as carbon sinks by absorbing and storing carbon dioxide through biomass and soil systems. In a carbon-constrained world, this ecological function is now monetised through carbon credits—tradable units representing one tonne of avoided or sequestered CO₂. Nigeria’s entry into this space is no longer theoretical. The federal government has begun to formalise this transition. The approval of a national carbon market framework is projected to unlock between $2.5–$3 billion annually in carbon finance, positioning Nigeria as a potential hub in Africa’s carbon economy. This signals a clear policy shift: forests are no longer just environmental assets; they are fiscal instruments tied to climate finance, foreign investment, and national revenue ambitions. However, this ambition raises a deeper governance question: who controls the carbon stored in Nigeria’s forests, and who benefits from its monetisation?

The Great Green Wall initiative offers a revealing case. Designed to restore degraded land across northern Nigeria and the Sahel, it is backed by a coalition of powerful international donors including the UNCCD, World Bank, Global Environment Facility, European Union, FAO, and IUCN.  These institutions are not merely funding tree planting; they are co-shaping the economic architecture of restoration where land, carbon, and livelihoods intersect. The implication is clear: the carbon sequestered in these restored landscapes is not just ecological value, it is potential tradable capital in global markets. The National Agency for the Great Green Wall has a responsibility to publicly disclose not just hectares restored, but carbon volumes generated, credit ownership structures, and revenue flows from any carbon-linked activities within its projects. If international donors are mobilising billions into restoration, then transparency must extend to how carbon assets emerging from these landscapes are quantified, priced, and traded. The National Council on Climate Change, as the coordinating body under the Climate Change Act, must clarify who holds custodianship over Nigeria’s carbon assets—federal government, state governments, or host communities—and establish a transparent registry that tracks carbon credit issuance, sale, and retirement. Without this, Nigeria risks building a carbon market that mirrors the opacity of its extractive sectors.

If Nigeria is to reverse deforestation trends, the conversation must shift from planting trees to tracking outcomes. Accountability should mean publicly verifiable data on forest restoration, independent audits of donor-funded projects, community-level monitoring systems that report in real time and enforceable consequences for violations. Without these, policies will remain aspirational, and funding will continue to outpace impact. Nigeria can no longer afford a system where forests are lost faster than they are monitored, where funds are spent without measurable outcomes, and where governance failures translate into violence. The time to act is now – not just to plant trees, but to fix the systems meant to protect them.

Spotlight

Gender Inequality and Nigeria’s Host Community Trusts
When Nigeria created Host Community Development Trusts (HCDTs), the idea was simple: communities where oil is extracted should finally have a say in how benefits are shared. However, a report by Policy Alert, a civil society group, has revealed an important perspective in the evaluation of how the trusts have operated in recent times. The group’s recently released 2026 Host Communities Development Index concludes that not everyone in the communities has a voice, and that women are most missing from that voice.
Across 18 Trusts assessed in the 2026 Host Communities Development Index, women are present, but mostly as beneficiaries. They receive support through programmes, but when it comes to decision-making: who sits on boards, who approves projects, who controls funds, they are largely absent, and that’s not a small gap but a core problem because development is not just about who benefits. It’s about who decides. Under the United Nations Sustainable Development Goal 5 (Gender Equality), inclusion isn’t just about involvement; it’s about equal participation in leadership and decision-making. Therefore, the question is simple: if women are not in leadership positions, can we really say that development is inclusive?
The Petroleum Industry Act (PIA) established HCDTs as institutions meant to give host communities a formal stake in resource governance. But while the law mandates funding structures and governance frameworks, it remains largely silent on gender representation thresholds. When there is no clear rule, the default system takes over and that system often excludes women from positions of power. In governance systems, diversity is not symbolic, it improves decision-making quality, accountability, and long-term planning. So, the real issue is not whether gender inclusion is desirable, it is whether the absence of it is undermining the effectiveness of HCDTs themselves. If the trusts are designed to reflect community interests, how can they do so when half the population is missing from the table? There’s another layer to this: the world is shifting away from fossil fuels. Energy transition is happening, slowly but steadily. And communities that depend on oil will be affected the most. Therefore, decisions being made today are not just about current projects, they are about future survivals and if governance structures are already excluding women, then half the community is being left out of planning for that future.
According to a media statement by Policy Alert, the Index assessed Trust performance across four key pillars, including governance and accountability, gender and social inclusion, environmental sustainability, and preparedness for the global energy transition. It said of the 18 Trusts evaluated across Rivers and Akwa Ibom States, “many still struggle with women’s representation, transparency, environmental responsibility, and readiness for the global energy transition, stressing: “women remain significantly under-represented in the governance structures of most Trusts. In most instances, Trusts were making noticeable investments in gender-focused development programmes, but not supporting women’s participation in governing structures. Of the Trusts assessed, only one – Foursome HCDT- had up to 40 percent of Board positions held by women. Two Trusts scored zero across all environmental sustainability indicators, despite operating in environmentally vulnerable coastal communities. It also found that energy transition preparedness remains weak, with no Trust among the 18 assessed having developed a comprehensive transition strategy.” Policy Alert produced the Index under its AGILE Project (Advancing Gender, Innovation, and Local Engagement in HCDTs), supported by the Canada Fund for Local Initiatives (CFLI).