Nigerian National Petroleum Company (NNPC) Limited has begun addressing its substantial $6 billion debt owed to suppliers.
This announcement was made by Wale Edun, Nigeria’s Minister of Finance and Coordinating Minister for the Economy, during a meeting with investors in Washington, D.C., on Wednesday.
Speaking about the NNPC’s financial situation, Edun provided insight into how the company has been managing its obligations since the removal of fuel subsidies on May 29, 2023.
He highlighted that, although the subsidy was removed from the government’s balance sheet, the issue of foreign exchange subsidies persisted, largely affecting the NNPC.
“In terms of NNPC and their situation, the reality is that, although the subsidy on May 29, 2023, was removed and was no longer on the balance sheet of the government, it did rear its head, not in terms of petrol subsidy, but foreign exchange subsidy, which was borne elsewhere, and borne mainly by NNPC,” Edun stated.
He expressed optimism about the company’s efforts to reduce its debt, noting that the NNPC has initiated steps to settle its outstanding payables.
“I think what I can say about their own situation is with where they are now, they have a route to paying down their payables and I’m sure that in no time at all, they will start. From what I understand, they have even commenced the process of paying down their payables,” he added.
The news marks a critical step in NNPC’s financial recovery as the company faces challenges stemming from both subsidy removal and foreign exchange pressures.
The move is expected to strengthen investor confidence in Nigeria’s energy sector and improve the liquidity of NNPC, which has been under pressure from global suppliers awaiting payments.