Nigeria’s road infrastructure ambitions may face a significant funding setback following the Nigerian National Petroleum Company Limited’s (NNPCL) withdrawal from the Road Infrastructure Tax Credit Scheme (RITCS), a move industry experts say could delay or even stall critical national projects.
The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, issued the warning while stressing that the absence of NNPCL’s massive financial contributions would leave a substantial gap in funding, potentially undermining economic growth and productivity.
The RITCS, introduced in 2019 under Executive Order 007 by the late former President Muhammadu Buhari, was designed to enable private sector players to fund major road construction and rehabilitation projects in exchange for tax credits. Over the years, the initiative has attracted big names, including Dangote Group, Nigeria LNG (NLNG), BUA Group, MTN, Access Bank, and the NNPCL—many of whom have completed high-quality projects on time and to international standards.
“Roads infrastructure is central to Nigeria’s productivity, trade, and national integration. Innovative financing models like RITCS are indispensable in bridging the gap between government resources and the nation’s huge infrastructure deficit,” Yusuf told The Nation.
He suggested exploring alternative Public-Private Partnership (PPP) models, such as a dedicated fuel levy for road construction, and selective tolling on high-traffic highways. However, he warned that the introduction of new taxes should be timed carefully to avoid worsening economic pressures on Nigerians.
According to Yusuf, relying solely on federal and state budgets or debt to fund road development is unsustainable. “The road sector’s deficit is too big for conventional funding channels. The RITCS has been a proof of concept that works—projects have been delivered, and they’ve been delivered well,” he added.
Despite its successes, the scheme has not been without controversy. Some state governments have argued that allowing NNPCL to deduct tax credits directly from Federation Account remittances undermines the constitutional revenue-sharing process. Members of the National Assembly have also raised concerns over the scheme’s alignment with the annual budget appropriation process.
Nonetheless, the CPPE boss maintained that these governance issues could be addressed without dismantling a model that has already delivered significant results.
Under the scheme:
Dangote Group constructed the 34km Apapa–Oworonshoki–Ojota Expressway in Lagos and the 43km Obajana–Kabba Road in Kogi State.
NLNG delivered the 38km Bodo–Bonny Road in Rivers State, a strategic project connecting oil-producing communities.
Other private partners have similarly completed key roads that support both commerce and rural access.
The projects have been lauded for their durability and timely delivery compared to some government-led efforts.
According to the Federation Account Allocation Committee (FAAC), NNPCL contributed a staggering $577.6 million and ₦822.3 billion to the RITCS between 2024 and April 2025. These contributions were crucial in financing flagship projects such as the Lagos–Badagry Expressway, the East–West Road, and the Nembe–Brass Road in Bayelsa State.
The company’s last dollar payment to the scheme was made in December 2024—$52.5 million. By early 2025, contributions shifted to naira, with ₦151.27 billion remitted in January and ₦671.04 billion in April.
With NNPCL’s exit, the federal government now faces the daunting task of sourcing an estimated ₦3 trillion to complete ongoing road projects tied to the tax credit model.
Industry insiders say the decision aligns with NNPCL’s post–Petroleum Industry Act (PIA) transformation into a fully commercial entity. The company is now prioritising profitability, operational efficiency, and shareholder value over the quasi-fiscal responsibilities that historically tied it to large-scale public infrastructure financing.
While this shift may make business sense for the oil giant, experts fear the knock-on effect will be felt across Nigeria’s infrastructure landscape for years to come.
Dr. Yusuf recommends:
Establishing a dedicated national infrastructure fund to replace lost private sector contributions.
Scaling up tolling and PPP models on high-value road corridors.
Encouraging broader private sector participation by offering improved tax incentives and legal protections.
Strengthening project monitoring to ensure transparency, quality, and timely delivery.
“The RITCS showed that public-private collaboration can transform our road network. Losing NNPCL’s commitment without a ready alternative risks undoing years of progress,” Yusuf warned.
