The Nigerian National Petroleum Company Limited (NNPC) is facing mounting legal and financial pressure, with pending lawsuits against the state-owned firm estimated at about N2.27 trillion in the 2024 financial year.

According to NNPC’s 2024 annual report, the company has recognised N474.8 billion as contingent liabilities for cases where legal advisers consider the risk of loss probable. However, an additional N1.8 trillion in lawsuits remain unresolved in courts, with no provisions made, as the likelihood of loss is considered only possible.

The total legal claims represent a significant rise compared to 2023. The recognised contingent liabilities jumped from N18.14 billion in 2023 to N474.8 billion in 2024, while unresolved lawsuits without provisions increased from N620.24 billion to N1.8 trillion over the same period.

NNPC explained that recognised liabilities cover lawsuits where external counsel confirmed a strong chance of adverse outcomes, while the unrecognised cases involve legal claims with uncertain results.

The company’s growing legal exposure reflects disputes inherited from its previous status as the Nigerian National Petroleum Corporation before its transformation into a limited liability company under the Petroleum Industry Act.

Many of these cases relate to joint venture funding, crude oil supply contracts, pipeline construction and maintenance, debt recovery, and arbitration awards. Some disputes date back over a decade, involving both domestic and international claimants.

While contingent liabilities do not automatically result in cash payments, the scale of unresolved claims could affect NNPC’s balance sheet, cash flows, and investment plans. This comes as the company continues to deal with production challenges, crude-backed loans, and funding pressures.