Upstream Regulator Refutes Claims of Holding Back N283.3bn Exploration Funds Meant for NNPC

The Nigerian Upstream Petroleum Regulatory Commission has dismissed suggestions that it withheld over N283.3bn meant to support crude oil exploration activities under the Nigerian National Petroleum Company Limited, describing the allegation as inaccurate and capable of creating unnecessary tension within the sector. The Commission explained that at no point did such funds pass through its accounts, stressing that it neither manages nor retains revenues earmarked for frontier exploration development.

The clarification followed public concerns triggered by reports implying that the regulator failed to transmit statutory payments meant to fund exploration in frontier basins. The Commission said the claims arose from a misunderstanding of how the Petroleum Industry Act structures revenue flows for exploration funding. According to NUPRC, the processes guiding the remittance, collection and management of these revenues are clearly defined in the PIA, and none of them place the responsibility for handling the funds on the regulator.

Officials of the Commission noted that the Frontier Exploration Fund—dedicated to financing the search for hydrocarbons in regions such as the Anambra, Sokoto, Bida, Chad and Gongola basins—is not domiciled with NUPRC and therefore cannot be subject to mismanagement by the agency. They emphasised that the legal framework assigns distinct roles to different institutions, including the Federal Inland Revenue Service, which is responsible for collecting certain statutory charges that ultimately constitute the fund.

In its response, NUPRC stated that the allegations were not only misleading but harmful to the progress being made in stabilising Nigeria’s upstream sector. The regulator explained that inaccurate information could undermine investor confidence, particularly at a time when the government is working to improve production volumes, strengthen operational efficiency and attract fresh investments into exploration activities.

The Commission added that its role is limited to monitoring compliance with regulations, supervising upstream operations and ensuring that industry players adhere to technical and environmental standards. It stressed that it is not empowered to collect or disburse monies meant for exploration financing and therefore cannot be held responsible for any claims relating to the movement of those funds. According to the agency, its operations are fully guided by transparency principles that do not permit any form of financial mismanagement.

Industry observers initially raised concerns about the reported sum amid ongoing efforts to expand Nigeria’s hydrocarbon reserves through intensified frontier basin exploration. Some stakeholders had questioned whether delays in funding might affect ongoing projects being handled by NNPC, which has been spearheading exploration efforts in parts of the North and other underexplored zones. The regulator, however, insisted that no obstruction originated from its end, stating that its actions have remained consistent with statutory provisions.

NUPRC said it believes the controversy may have stemmed from misinterpretations of the PIA, particularly regarding how revenues associated with exploration are generated and warehoused. It urged stakeholders to exercise caution in circulating unverified information, noting that clarity is essential to prevent unnecessary disruptions within the industry. The Commission maintained that all financial transactions connected to the frontier exploration framework are handled through approved government channels, none of which is under its control.

In addressing broader concerns, the Commission reiterated its support for ongoing exploration programmes aimed at securing Nigeria’s long-term energy future. It explained that successful frontier basin development remains one of the key strategies for expanding reserves, diversifying production sources and improving national output. The regulator emphasised that it has continuously collaborated with other government agencies and industry partners to streamline regulatory processes and eliminate bottlenecks that could stall exploration activities.

Meanwhile, NNPC has maintained that exploring new basins is critical to sustaining national production levels and discovering fresh reserves capable of supporting the country’s economic aspirations. The company has been undertaking seismic studies, drilling activities and geological assessments in several locations under its frontier exploration mandate. Industry analysts note that adequate and timely funding is crucial for achieving desired results, particularly as global competition for investment in fossil fuel development intensifies.

The controversy surrounding the alleged non-remittance has revived discussions on the need for clarity and coordination in managing Nigeria’s petroleum revenues. Experts argue that improving transparency in the implementation of the PIA remains essential for ensuring that all agencies understand their roles and uphold accountability. They add that proper interpretation of the Act is critical for maintaining confidence among investors and international partners.

NUPRC reaffirmed that the Commission stands by its long-standing commitment to uphold global standards in regulating the upstream sector. It assured Nigerians that its operations remain transparent, legally compliant and geared towards supporting the government’s objectives of boosting production, expanding reserves and ensuring sustainable energy development. The agency urged stakeholders to disregard unfounded allegations and rely on verified information as efforts continue to position Nigeria’s petroleum industry for long-term stability and growth.