Senior Advocate of Nigeria, Femi Falana, SAN, FCIArb, has written to the Attorney General of the Federation and Minister of Justice, Lateef Fagbemi, SAN, demanding the immediate initiation of legal measures to recover a staggering $120.5 billion and N66.4 billion allegedly owed to the Government of the Federation by the Nigerian National Petroleum Company Limited (NNPCL) and various oil and gas companies operating in Nigeria, giving the AGF a 14-day ultimatum before filing suit at the Federal High Court to compel recovery.

The letter, dated June 3, 2025, and written on behalf of the Alliance on Surviving Covid-19 and Beyond (ASCAB), sets out five categories of uncollected funds backed by court judgments, Supreme Court consent orders, reports of the Nigerian Extractive Industries Transparency Initiative (NEITI), the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), the Auditor General of the Federation, and resolutions of both chambers of the National Assembly.

Falana argued that if the funds are recovered, the Federal Government and state governments would “cease to incur more external loans to the detriment of the national economy,” a pointed reference to the fact that the National Assembly approved President Tinubu’s request for a $2.1 billion external loan in November 2024 to fund the 2025 budget at a time when over $120 billion in government revenue remained uncollected.

Falana’s letter breaks the $120.5 billion claim into five distinct categories, each backed by specific legal authorities, government reports, or judicial decisions.

Falana disclosed that the Federal Government deliberately refused to implement Section 16 of the Deep Offshore Inland Production Sharing Contracts Act, which required an upward review of royalties whenever crude oil was sold beyond $20 per barrel in the international market. The non-implementation, which persisted for 18 years, resulted in an estimated $62 billion in royalties that were never collected from the International Oil Companies (IOCs).

When ASCAB confronted the Federal Government with the economic sabotage, the government admitted that the country had lost billions of dollars but refused to act. The governments of Akwa Ibom, Bayelsa, and Rivers States subsequently filed a suit at the Supreme Court to compel the Federal Government to collect the outstanding royalties.

In a consent judgment delivered on October 20, 2018, the Supreme Court ordered the Federal Government to collect all outstanding royalties that had accrued for 18 years and to pay the 13 per cent derivation due to the oil-producing states upon recovery in accordance with Section 162 of the 1999 Constitution.

The then Attorney General of the Federation, Abubakar Malami, SAN, constituted a committee which determined that the amount owed was $62 billion. However, the IOCs ignored the demand for payment.

Subsequently, Akwa Ibom and Rivers States filed separate cases at the Federal High Court and obtained judgments. Justice Taiwo Taiwo (now retired) granted relief of $3.3 billion to both states with post-judgment interest at 10 per cent until liquidation. Justice Inyang Ekwo, in a separate action, entered judgment in favour of Bayelsa State for $951 million.

Despite these court orders, the $62 billion remains substantially uncollected.

Falana revealed that a team of Nigerian lawyers engaged by the Nigerian Maritime Administration and Safety Agency (NIMASA) discovered that approximately 60.2 million barrels of crude oil stolen from Nigeria by IOCs were discharged at the Philadelphia Port in the United States between 2011 and 2014, with a value of $12.7 billion. The IOCs and shipping companies involved are known to the Federal Government.

When the Office of the Attorney General refused to prosecute the indicted companies, the NIMASA legal team filed nine cases in the Abuja and Lagos divisions of the Federal High Court seeking recovery of the value of the stolen hydrocarbons and liquefied gas. Reports from the legal team were submitted to the AGF’s office.

In addition, the House of Representatives set up an Ad Hoc Committee in 2016 to probe undeclared crude oil and LNG exports from Nigeria between 2011 and 2014. The committee chairman, Hon. Johnson Agbonayinma, confirmed that $17 billion in oil and LNG was exported from Nigeria without proper records, with the crude discharged at the US ports of Houston and Lake Charles.

The total value of stolen crude oil and LNG identified across both investigations amounts to approximately $29 billion, which Falana urged the AGF to direct the EFCC to recover.

Falana addressed one of the most contentious financial disputes between the NNPCL and the Federation Account. Nigeria LNG Limited (NLNG) is a joint venture owned by NNPCL (49 per cent), Shell (25.6 per cent), TotalEnergies (15 per cent), and Eni International (10.4 per cent). NNPCL holds its 49 per cent shares on behalf of the Government of the Federation.

Over the past 26 years, NLNG has paid dividends of over $44 billion to shareholders, of which 49 per cent, approximately $21.5 billion, went to the Government of Nigeria via NNPCL. However, Falana alleged that NNPCL has failed to remit this amount to the Federation Account contrary to Section 162 of the Constitution, which requires all revenues collected by the government to be paid into the Federation Account.

Falana noted that despite resolutions of both the Senate and House of Representatives, and recommendations from the Auditor General of the Federation, NEITI, and RMAFC, NNPCL has retained the funds.

Citing the NEITI 2022/2023 Independent Oil and Gas Industry Report released on September 27, 2024, Falana stated that outstanding collectable revenues due to the Federal Government as of June 2024 stood at $6.071 billion and N66.4 billion.

He expressed frustration that instead of collaborating with NEITI to recover these funds, both chambers of the National Assembly proceeded in November 2024 to approve President Tinubu’s request for a $2.1 billion external loan to fund the 2025 budget.

Falana highlighted the failed rehabilitation of Nigeria’s three government-owned refineries. In April 2021, the Federal Executive Council approved a $1.5 billion contract for the rehabilitation of the two Port Harcourt refineries. In August 2021, FEC approved an additional $1.48 billion for the Warri and Kaduna refineries, bringing the total to approximately $2.9 billion.

The contracts, awarded to foreign firms, were to be completed in phases within specified timelines. However, Falana noted that the Warri Refinery ceased operations on January 25, 2025, due to safety issues, while the Port Harcourt Refineries were shut down for planned maintenance beginning May 29, 2025.

“In view of the undeniable fact that the foreign firms have breached the terms of the contracts, we urge your office to submit a petition to the Economic and Financial Crimes Commission for the recovery of the contract sum of $2.9 billion. This will enable the Federal Government to re-award the contracts,” Falana stated.

Combining all five categories, Falana’s letter identifies the following amounts as owed to the Federation:

$62 billion in uncollected royalties from IOCs; $29 billion in proceeds of stolen crude oil and LNG; $21.5 billion in NLNG dividends withheld by NNPCL; $6.17 billion in outstanding revenues identified by NEITI; N66.4 billion in additional outstanding revenues identified by NEITI; and $2.9 billion in failed refinery rehabilitation contracts.

The total in dollar terms is approximately $121.57 billion (which Falana rounded to $120.5 billion in his headline figure), plus N66.4 billion.

Falana concluded by giving the Attorney General 14 days from receipt of the letter to initiate legal measures for the recovery of the funds, failing which ASCAB would file suit at the Federal High Court to compel the AGF to discharge the duties of his office in accordance with Section 287 of the Constitution and other relevant laws.

On the question of whether ASCAB has the legal standing to file such a suit, Falana cited the organisation’s track record, including drafting and submitting the Bill for the amendment of the Deep Offshore and Production Sharing Contracts Act to the National Assembly in 2017. The Bill, which was adopted and passed by the 9th Assembly, was assented to by former President Muhammadu Buhari on November 4, 2019. The then Senate President Ahmad Lawan stated that the amendment would increase national revenue by not less than $1.5 billion per annum.

Falana’s letter confronts the Federal Government with a simple proposition: Nigeria is sitting on over $120 billion in uncollected, stolen, or withheld revenues that are backed by court judgments, government reports, and statutory obligations, yet the government continues to borrow externally to fund its budgets.

The claim that NNPCL has withheld $21.5 billion in NLNG dividends that constitutionally belong to the Federation Account is particularly explosive, as it suggests that the national oil company has been operating as a parallel treasury, retaining funds that should be shared among the three tiers of government through the statutory revenue allocation framework.

The $62 billion royalties claim, backed by a Supreme Court consent judgment from 2018, represents the single largest identified debt owed to the Nigerian government, yet seven years after the Supreme Court ordered collection, the funds remain substantially unrecovered.

The stolen crude oil claim of $29 billion, supported by NIMASA investigations and a House of Representatives probe, raises questions about why the Federal Government has not pursued criminal prosecution of the identified companies or taken more aggressive civil recovery action.

If the Attorney General fails to respond within the 14-day ultimatum, Falana’s threat to file suit at the Federal High Court would create yet another high-profile case testing the boundaries of public interest litigation and the extent to which citizens and civil society organisations can compel government officials to discharge their constitutional duties.

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