The Nigerian National Petroleum Company Limited recorded a substantial increase in board and workforce expenses during 2024, with directors’ fees and reimbursable expenses climbing to N4.096bn, while overall employee benefits surged to N749.7bn, the company’s audited annual financial report has revealed.
Analysis of the 2024 Annual Report shows directors’ remuneration rose approximately 58 per cent from N2.593bn in 2023, representing a 214 per cent jump from the N824m paid in 2022.
Simultaneously, the national oil company recorded zero voluntary staff resignations across all age brackets for the second consecutive year—a trend attributed to enhanced welfare packages and increased spending on staff-related benefits.
The 11-member board remained unchanged throughout the 2024 financial year, contributing to the elevated directors’ costs reflected in the accounts. The board was led by Chief Dr Pius O. Akinyelure as chairman, with Mallam Mele Kolo Kyari serving as Group Chief Executive Officer.
Alhaji Umar Isa Ajiya held the position of Group Chief Financial Officer until November 2024, before Mr Adedapo Segun’s appointment. Other non-executive directors included Amb. Nicholas Agbo Ella, Mr Okokon Ekanem Udo, Mr Ledum Mitee, Mr Musa Tumsah, Dr Ibraheem Ghali-Mohammed, Prof Almustapha Aliyu, Mr David Ogbodo, and Mrs Eunice Thomas.
Most directors’ tenures concluded on April 2, 2025, when President Tinubu dissolved the board and installed new leadership under Engr. Ahmadu Musa Kida as chairman and Engr. Bashir Bayo Ojulari as Group CEO.
Despite rising board expenses, total compensation for key management personnel declined marginally in 2024. Short-term employee benefits for senior executives increased to N985m from N818m in 2023, while post-employment pension and medical benefits dropped to N380m from N631m. Overall compensation for key management stood at N1.365bn in 2024, down from N1.449bn the previous year.
The figures cover key management personnel, defined as the Group CEO, CFO, General Counsel, Company Secretary, and all Executive Vice Presidents.
Workforce and Employee Benefits
Beyond board and executive compensation, NNPC spent N749.7bn on employee benefits at the Group level in 2024, up from N581.8bn in 2023. Workforce data confirms that no employee aged between 30 and 59 resigned voluntarily during the year, with all exits resulting from mandatory retirement between ages 60 and 65—mirroring the 2023 pattern.
Staff-related spending included N272.7bn on salaries and wages, N79.1bn on allowances, and N40.5bn on welfare. Pension costs under the defined contribution plan totalled N44bn, while gratuity charges rose to N84.4bn. Post-employment medical benefits amounted to N3.3bn, with long-term employee benefits at N4.4bn. At the company level, employee benefit expenses reached N192.3bn in 2024.
The zero-resignation trend highlights the effectiveness of NNPC’s compensation and welfare framework since its transformation into a limited liability company under the Petroleum Industry Act in 2021. As a commercial entity, NNPC has expanded spending on salaries, health coverage, pensions, gratuities, and long-service awards.
However, the sharp rise in directors’ fees and staff costs is likely to attract heightened public scrutiny amid economic pressures, fuel subsidy removal consequences, and ongoing debates about cost efficiency and value delivery at the national oil company.
Administrative Expenses Surge
General and administrative expenses at NNPC Limited increased sharply in 2024, reflecting the growing operational costs of Africa’s largest national oil company during its transition to full commercial status.
Total general and administrative expenses at the Group level surged to N3.58tn in 2024, up from N2.09tn in 2023. At the company level, expenses climbed to N1.66tn, compared with N994.08bn the previous year.
Depreciation charges rose steeply, with depreciation of property, plant, and equipment jumping to N623.41bn in 2024 from N101.03bn the prior year, reflecting asset revaluation, increased capitalisation, and operational expansion. Depreciation of right-of-use assets increased to N66.5bn, compared with N13.93bn in 2023.
Professional and consultancy fees recorded one of the sharpest increases, ballooning to N699.67bn at the Group level in 2024 from N184.2bn previously. At the company level, consultancy costs rose to N544.17bn, up from N81.64bn, indicating growing reliance on external advisory and technical services.
Software licences and maintenance spending climbed significantly to N210.06bn at the Group level from N66.59bn in 2023, while security expenses increased to N271.37bn compared with N170.7bn the previous year, reflecting persistent security challenges across oil and gas assets.
Other expenditure categories also trended upward. Transport and travel expenses doubled to N91.55bn, while training and recruitment costs rose to N90.39bn from N48.95bn. Entertainment expenses climbed to N30.34bn from N7.44bn, and spending on local community development increased to N29.89bn, compared with N6.87bn in 2023.
NNPC also recorded N27.76bn disbursement under the Host Community Development Fund, reflecting obligations under the Petroleum Industry Act, while fuel and lubricants expenses stood at N27.4bn. The company further disclosed N118.78bn in fines and penalties—an expense line absent from prior year figures. Audit fees stood at N3.16bn, slightly higher than N2.68bn the previous year.
On the asset side, the company reported N98.07bn as impairment on assets held for sale, alongside N16.75bn written off as intangible assets and N633m in amortisation of intangible assets.
Despite increases across most categories, other expenses fell sharply to N146.87bn at the Group level in 2024 from N563.74bn in 2023, suggesting reclassification or tightening of certain discretionary spending.
Growing Scrutiny
NNPC’s governance costs have faced closer public examination since the company’s transition from a state corporation to a limited liability company under the Petroleum Industry Act, which mandates stricter financial disclosures and transparency.
Supporters of the reforms argue that competitive remuneration is essential to attract and retain top talent in a commercialised national oil company. Critics, however, have consistently raised concerns about rising administrative and board costs during a period of economic hardship and persistent revenue pressures.
The substantial increase in NNPC’s administrative and operating costs is expected to fuel renewed public and policy debate about cost efficiency, transparency, and value for money at the national oil company—particularly amid economic strain and heightened scrutiny of public-sector spending following fuel subsidy removal and broader fiscal reforms.
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