Nigeria is set to receive a $1.05bn syndicated loan backed by oil from the African Import Export Bank next month.
The loan is part of a larger $3.3bn prepayment facility arranged by Afreximbank, with repayment terms tied to crude cargoes from the Nigerian National Petroleum Company Ltd.
According to Bloomberg, Afreximbank’s Senior Executive Vice President for Finance, Administration, and Banking, Denys Denya, confirmed the verification of crude availability, paving the way for the final release of the balance within the next month.
The loan aims at reviving Nigeria’s economy and enhancing the supply of hard currency in the local foreign exchange market. A substantial portion of it — two-thirds, was already disbursed in January.
This financial maneuver is designed to provide Nigeria with immediate funds based on future oil production, offering a lifeline to the country’s struggling economy.
The Nigerian National Petroleum Company Limited, had in January said it would prepay future royalties and taxes to the Federal Government from the $3.3bn financing deal it got from African Export-Import Bank last year.
NNPCL disclosed this in a document titled, ‘Frequently Asked Questions – Project Gazelle’, released by its Chief Corporate Communications Officer, Olufemi Soneye.
According to reports, the NNPCL announced that it had secured a $3.3bn emergency crude oil repayment loan from the African Export-Import Bank.
It explained that the loan would be used by the oil company to support the Federal Government in stabilising Nigeria’s exchange rate.
The company also said then that it adopted a lower price benchmark for the $3.3bn crude-for-cash loan to reduce the risk of default and ensure financial stability.
