The Nigerian government is set to receive $1.05 billion syndicated loan backed by oil towards the end of May 2024.
The loan is part of a larger $3.3 billion prepayment facility arranged by Afreximbank, with repayment terms tied to crude cargoes from the Nigerian National Petroleum Company Ltd.
Bloomberg quoted Afreximbank’s senior executive vice president for finance, administration, and banking, Mr Denys Denya, as confirming the verification of crude availability, paving the way for the final release of the balance within the next month.
The government has pledged 164.25 million barrels of crude oil at 90,000 barrels per day from 2024 to repay the loan.
“The verification of the crude availability has happened so we expect in the next month to finalise the release of the balance. Based on future production, you get the money now,” Denya said.
He said the facility has participation from commercial banks and oil traders, most of which have already secured internal approvals.
Denya also said the firm was finalising a $200 million funding plan that includes guarantees, and letters of credit to support the East African crude oil pipeline linking Uganda’s oil fields to Tanzania’s port of Tanga.
The project, which is estimated to cost $5 billion, has received criticism from climate activists who have successfully persuaded lenders and insurers to steer clear of the pipeline.
Denya said the construction of the 1,443-kilometer (897-mile) pipeline is targeted at improving ‘intra-regional trade which is part of our mandate, so it ticks all the boxes for us there’s really no reason for us not to be supporting this’, adding that the investments will add to plans by Afreximbank to increase loans and advances by 53 per cent to $40 billion by the end of 2024.
